Contingency Clauses In Home Purchase Contracts

A contingency clause defines a condition or action that must be met in order for a real estate contract to become binding. A contingency becomes part of a binding sales contract when both parties (i.e., the seller and the buyer) agree to the terms and sign the contract. Accordingly, it is important to understand what you're getting into if a contingency clause is included in your real estate contract. Here, we introduce widely used contingency clauses in home purchase contracts and how they can benefit both buyers and sellers.

Real Estate Contracts

A real estate transaction typically begins with an offer: a buyer presents an offer to purchase to a seller who can either accept or reject the proposal. Frequently, the seller counters the offer and negotiations go back and forth until both parties reach an agreement. If either party does not agree to the terms, the offer becomes void and the buyer and seller go their separate ways with no further obligation. If both parties agree to the terms of the offer, however, the buyer makes an earnest money deposit – a sum paid as evidence of good faith, typically amounting to 1% of the sale price. The funds are held by an escrow company while the closing process begins.

Sometimes a contingency clause is attached to an offer to purchase real estate and included in the real estate contract. Essentially, a contingency clause gives parties the right to back out of the contract under certain circumstances that must be negotiated between the buyer and seller. Contingencies can include details such as the timeframe (e.g. "The buyer has 14 days to inspect the property") and specific terms (e.g. "The buyer has 21 days to secure a 30-year conventional loan for 80% of the purchase price at an interest rate no higher than 4.5%"). Any contingency clause should be clearly stated so that all parties understand the terms.

If the conditions of the contingency clause are not met, the contract becomes null and void, and one party (most often the bu! yer) can back out without legal consequences. Conversely, if the conditions are met, the contract is legally enforceable and a party would be in breach of contract if he or she decided to back out. Consequences vary, from forfeiture of earnest money to lawsuits. For example, if a buyer backs out and the seller is unable to find another buyer, the seller can sue for specific performance, forcing the buyer to purchase the home.

Types of Contingency Clauses

Contingency clauses can be written for nearly any need or concern. Here are the most common contingencies included in today's home purchase contracts:

Appraised Contingency

An appraisal contingency protects the buyer, used to ensure a property is valued at a minimum, specified amount. If the property does not appraise for at least the specified amount, the contract can be terminated and the earnest money, in many cases, is refunded to the buyer. An appraisal contingency may include terms that permit the buyer to proceed with the purchase even if the appraisal is below the specified amount, typically within a specified number of days after the buyer receives the notice of appraisal value. The seller might have the opportunity to lower the price to the appraisal amount. The contingency specifies a release date, on or before which the buyer must notify the seller of any issues with the appraisal; otherwise, the contingency will be deemed satisfied and the buyer will not be able to back out of the transaction.

Financing Contingency

A financing contingency (also called a "mortgage contingency") gives the buyer time to apply for and obtain financing for the purchase of the property. This provides important protection for the buyer, who can back out of the contract and reclaim his or her earnest money in the event he or she is unable to secure financing from a bank, mortgage broker or other type of private lending. A financial contingency will state a specified number of days that the buyer has to obtain financing. The buyer has until this date to terminate the contract (or request an extension that must be agreed to in writing by the seller); otherwise, the buyer automatically waives the contingency and becomes obligated to purchase the property – even if a loan is not secured.

House Sale Contingency

Although in most cases it is easier to sell before buying another property, the timing and financing don't always work out that way. A house sale contingency gives buyers a specified amount of time to sell and settle their existing homes in order to finance the new one. This type of contingency protects buyers because, if an existing home doesn't sell for at least the asking price, the buyer can back out of the contract without legal consequences. House sale contingencies can be difficult on the seller, who may be forced to pass up another offer while waiting for the outcome of the contingency. The seller retains the right to cancel the contract if the buyer's home is not sold within the specified number of days.

Inspection Contingency

An inspection contingency (also called a "due diligence contingency") gives the buyer the right to have the home inspected within a specified time period, such as 5-7 days. It protects the buyer, who can cancel the contract or negotiate repairs based on the findings of a professional home inspector. An inspector examines the property's interior and exterior, including the condition of electrical, finish, plumbing, structural and ventilation elements. The inspec! tor furnishes a report to the buyer detailing any issues discovered during the inspection. Depending on the exact terms of the inspection contingency, the buyer can:

Approve the report and the deal moves forward Disapprove the report and back out of the deal (and have earnest money returned) Request time for further inspections if something needs a second look Request repairs or concession (if the seller agrees, the deal moves forward; if the seller refuses, the buyer can back out of the deal and have his or her earnest money returned) A cost of repair contingency is sometimes included in addition to the inspection contingency. This specifies a maximum dollar amount for necessary repairs. If the inspection indicates that repairs will cost more than this dollar amount, the buyer can elect to terminate the contract. In many cases, the cost of repair contingency is based on a certain percentage of the sales price, such as 1-2%.

Kick-Out Clause

The kick-out clause is a contingency added by sellers to provide a measure of protection against a house sale contingency. While the seller agrees to a house sale contingency, he or she can add a kick-out clause stating that the seller can continue to market the property. If another qualified buyer steps up, the seller gives the current buyer a specified amount of time (such as 72 hours) to remove the house sale contingency and keep the contract alive; otherwise, the seller can back out of the contract and sell to the new buyer.

The Bottom Line

A real estate contract is a legally enforceable agreement that defines the roles and obligations of each party in a real estate transaction, and contingencies are attached to and made part of contracts. It is important to read and understand your contract, paying attention to all specified dates and deadlines. Because time is of the essence, one day (and one missed deadline) can have a negative - and costly - effect on your real estate transaction.

In certain states, real estate professionals are allowed to prepare contracts and any modifications, including contingency clauses. In other states, however, these documents must be drawn up by licensed attorneys. It is important to follow the laws and regulations of your state. In general, if you are working with a qualified real estate professional, he or she will be able to guide you through the process and make sure that documents are correctly prepared (by an attorney if necessary). If you are not working with an agent or broker, check with an attorney if you have any questio! ns about real estate contracts and contingency clauses.

Uber is delivering kittens for National Cat Day

Celebrate National Cat Day with an Uber-delivered kitten!

NEW YORK (CNNMoney) In honor of the venerated holiday National Cat Day, startup Uber is temporarily expanding past taxi-hailing to ... kitten delivery service.

Uber usually lets its app users order a taxi, black car or SUV to come pick them up at their current location. Tuesday's promotion added a "Kittens!" option to the list. (Yes, exclamation point included.)

For $20, Uber will deliver a kitten for you to snuggle for fifteen minutes -- and even throw in a few cupcakes to add to all the sugary sweetness. The service is available for only a few hours on Tuesday in Seattle, New York and San Francisco.

Uber, which partnered with Internet meme site Cheezburger for the kitten service, will donate all of the fees to one animal shelter in each city, and each of the kittens is available to adopt.

  Grumpy Cat gets Hollywood movie deal

"The Internet is made for kittens," Uber wrote in its press release.

Truer words were never spoken.

News of Uber's Cat Day celebration quickly gained traction in blogs and social media, with people complaining they had been trying for hours to score a kitten, with no success. Some expressed concern that transporting shelter kittens back and forth is cruel, but most simply LOLed at the stunt.

Adding to the hilarity: "Uber for cats" is a semi-often-used joke for ridiculous and derivative startup ideas. CNN.com joked about "Mewber" in a post in May.

The real Uber is exciting to venture capitalists, though. The company is worth a reported $3.4 billion.

Apple Confirms Decline in Earnings Even If Above Estimates

Apple Inc. (NASDAQ: AAPL) has now reported its quarterly earnings report, which was also the end of the technology giant’s fiscal year as well. Earnings came in at $8.26 per share (EPS) on sales of $37.5 billion. Estimates were down to $7.93 EPS from $8.67 EPS a year ago. Revenue was expected to be $36.84 billion, which would have been 2.4% sales growth from a year ago.

Apple’s quarterly net income was $7.5 billion. Gross margin came in about 37%. Apple had previous offered up guidance for this quarter of 36% to 37% margins on sales of $34 billion to $37 billion.

Tim Cook gave guidance of $55 billion to $58 billion in revenue this coming quarter versus estimates of $55.65 billion. The guidance was also shown in a range of 36.5 percent and 37.5 percent for gross margin. Apple’s cash, cash equivalents, and securities added up to almost $147 billion at the end of the September quarter.

International sales accounted for 60% of revenue in this last quarter. Unit sales were as follows:

33.8 million iPhones, a record, and compared to 26.9 million in the year-ago quarter; 14.1 million iPads, compared to 14 million in the year-ago quarter; and 4.6 million Macs, compared to 4.9 million in the year-ago quarter.

Tim Cook showed that Apple generated a whopping $9.9 billion in cash flow from operations in the last quarter. The company also returned $7.8 billion in cash to shareholders through dividends and share repurchases.

Apple shares closed up 0.7% at $529.88 against a 52-week range of $385.10 to $603.00. Its 50-day moving average was $492.48 and 200-day moving average was $451.86 according to stockcharts.com ahead of he closing price on Monday going into earnings. Shares are indicated down around 3% around $513 in the after-hours trading session.

Tweets on Twitter updated below at 5:20 p.m. EST:

Source: Twitter @jonogg

German Stocks Advance as Deutsche Lufthansa Recovers

German stocks were little changed, as declines in utilities and banks offset gains in Deutsche Lufthansa AG (LHA) and Deutsche Boerse AG.

RWE AG (RWE), Germany's second-largest utility, slipped 2.4 percent after RBC Capital Markets cut its recommendation on the stock. Lufthansa followed its European peers higher, recovering some of its Aug. 2 selloff. Xing AG (O1BC), the business social network, jumped the most since October as Deutsche Bank AG (DBK) upgraded its rating on the shares.

The benchmark DAX Index (DAX) fell 0.1 percent to 8,398.38 at the close of trading in Frankfurt, after earlier losing as much as 0.5 percent. The equity benchmark rose 2 percent last week, extending its 2013 advance to 10 percent as the Federal Reserve kept its monthly bond purchases unchanged. The broader HDAX Index dropped less than 0.1 percent today.

"After a strong performance during the last weeks we are seeing a consolidation in the market with extremely low volumes," Soeren Steinert, who helps manage about $24 billion as associate director for equities trading at Quoniam Asset Management GmbH in Frankfurt, wrote in an e-mail.

RWE slipped 2.4 percent to 22 euros. RBC Capital Markets cut its rating on the stock to underperform, the equivalent of sell, from sector perform, and reduced its 12-month share-price estimate to 20 euros, citing the delayed impact of lower power prices on the company's profit in 2014 and 2015. EON AG, the country's largest utility, lost 1.1 percent to 12.60 euros.

Banks Retreat

Deutsche Bank, Germany's biggest lender, slipped 0.8 percent to 34.24 euros, and Commerzbank AG (CBK), the second-largest, retreated 1.6 percent to 6.66 euros. A gauge of European banking stocks fell the most of the 19 industry groups the Stoxx Europe 600 Index.

Lufthansa added 1.2 percent to 14.84 euros as a measure of European travel and leisure stocks was among the best performers on the Stoxx 600. Europe's second-largest airline last week said restructuring efforts are starting to pay off as an efficiency push helps improve earnings.

Xing rose 8.9 percent to 56.17 euros as Deutsche Bank upgraded the shares to buy from hold. Opportunities for growth have not been fully appreciated by the market, according to the bank, which cited Xing's product portfolio and attractive market opportunities. The shares have a 30 percent upside potential, Deutsche Bank said.

Deutsche Boerse, operator of Frankfurt's stock exchange, added 3.4 percent to 55.87 euros.

ProSieben Upgraded

ProSiebenSat.1 Media AG, the broadcaster controlled by KKR & Co. and Permira Advisers LLP, advanced 0.9 percent to 33.47 euros as Liberum Capital upgraded the shares to buy, reversing a downgrade that it made on July 22. The brokerage said the company's second-quarter results and commentary gave it more confidence about conditions in the German advertising market.

Solarworld AG (SWV) jumped 26 percent to 64 euro cents as creditors approved proposals to try to save Germany's biggest solar-panel maker. A total of 99.96 percent of noteholders present in a meeting in Bonn today representing 35.78 percent of Solarworld's 150 million-euros ($198.8 million) of bonds due July 2016 backed the restructuring plan, the company said in a statement.

What is difference between bond and share?

A: You buy share for capital appreciation, you buy share for growth, you buy share to create wealth. You buy bond to protect your wealth you have created so, in a way it is different but interestingly like equity have a PE multiple, bond also have PE multiple. Therefore, it could be good guide to you to look at when you should invest in the bond fund, for instance if a bond have a 10 PE multiple then it means the current yield is 10 percent and if a bond have a 12.5 PE multiple then it means the bond is offering 8 percent. So, you can use that as a tool to invest in the bond or not to invest in a bond.

Second thing share market plays a very important role when one look at investing in the bond because many time people invest in the bond or deposits of the company which are unknown and once they invest they do not know what happen to their portfolio, what has happened to the company but if you invest in the company which is listed on a stock exchange, the price of the share will tell you many things which perhaps is the financial of the company may not be able to tell you. So, in a way they are not connected but in a way they are connected.

Flash Memory Provider Spansion Lowers Guidance

Based on a review of "preliminary financial results," embedded systems solutions provider Spansion (NYSE: CODE  ) has lowered its second quarter 2013 revenue and earnings guidance, the company announced today.

Spansion's Q2 revenues, scheduled to be released "on or around July 31, 2013," were expected to range between $200 million and $220 million. However, due in large part to market weakness in Japan, according to Spansion, revenue expectations have been revised downward, and should fall between $193 million to $197 million for the quarter.

Non-GAAP, second quarter earnings estimates are now expected to range from $0.25 to $0.27 per share, as opposed to earlier guidance suggesting Spansion's Q2 earnings per share would fall between $0.16 and $0.23. The revised earnings for the recently concluded quarter are adjusted for "two one-time items related to foreign exchange and taxes that add approximately $0.10 to earnings per share," Spansion said.

Why Covanta Holding Corp (CVA) is Down Today

NEW YORK (TheStreet) -- Waste-to-energy company Covanta Holding Corp (CVA) tumbled 12.4% to $17.72 in Thursday trading, after reporting third-quarter results and revising full-year guidance a day earlier.

For the full-year 2013, the company revised its earnings forecast to a range between 33 cents and 43 cents a share, compared to its previous guidance range of 40 cents to 50 cents a share. Analysts surveyed by Yahoo! Finance estimated earnings of 44 cents a share. In the 2012 financial year, the company's earnings were 52 cents a share.

"We've lowered our 2013 guidance because of three key factors: unscheduled outages, lower-than-expected steam demand, and organic growth slower than we hoped," said CEO Anthony Orlando in a statement.

For the third quarter ended Sept. 30, the Morristown, New Jersey-based company recorded earnings of 28 cents, a cent higher than analysts' estimates, on revenue of $427 million, beating expectations by $2.06 million. During the third quarter, Covanta signed a 20-year contract with the New York City Department of Sanitation and acquired a $49 million, 1,050 ton-a-day facility in Camden, N.J., both of which are projected to drive long-term growth. Though it lost 12.4% throughout the day, the stock regained some confidence in post-market trading, up 1.6% to $18. TheStreet Ratings team rates Covanta Holding Corp as a Buy with a ratings score of B. The team has this to say about its recommendation: "We rate Covanta Holding Corp (CVA) a BUY. This is driven by a number of strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth and increase in stock price during the past year. We feel these strengths outweigh the fact that the company has had sub par growth in net income." You can view the full analysis from the report here: CVA Ratings Report

When Will The Pain End For Caterpillar?

Tweet 0 Disqus Email Print Feedback Share Tweet 0 Disqus Email Print Feedback 0 Disqus When Will The Pain End For Caterpillar? October 23, 2013 | Filed Under » Earnings Recap, Equity, Heavy Construction, Industrial Equipment Wholesale Tickers in this Article » CAT, GE, UTX, BA, GS, After reporting weaker-than-expected results earlier this year because of a drop-off in orders for mining equipment, Caterpillar (NYSE:CAT) CEO Doug Oberhelman sounded an optimistic note, telling CNBC, "We don't want to be overly optimistic but it certainly feels better than the last two springs."

Unfortunately, things haven't gotten better for the Peoria, Illinois-based company. The company today reported earnings that were far worse than analysts expected and slashed its outlook for the year. The numbers were so bad that CNBC's Herb Greenberg nominated Oberhelman to win the title of worst CEO of the year. That assessment, though, may be overly harsh.

For one thing, Oberhelman doesn't seem like he's sugarcoating the company's problems. He called 2013 "a painful year" in the company's earnings release, but he added that there are "encouraging signs" for 2014.

"The rest of the business is hanging in there," Oberhelman said to CNBC.

Commodities have gone through cycles of booms and busts for decades. The forces of supply and demand balance each other out, and when that happens Caterpillar stands to benefit. Of course, the tricky part is figuring out when that rebound will occur.

"It (mining) comes back," said Eli Lustgarten, an analyst with Longbow Securities, to CNBC. "It just takes time."

The time, though, is right for investors to add Caterpillar to their portfolio because the shares have gotten too cheap to ignore.

For one thing, the shares are trading at a price-to-earnings multiple of about 14, well under their five-year average high of 39.9. That's cheaper than other industrial companies such as General Electric (NYSE:GE) (18), United Technologies (NYSE:UTX) (19) and Boeing (NYSE:BA) (23). Wall Street has an average 52-week price target on Caterpillar of about $92, about 9.5% above where it currently trades.

Investors, though, should be aware that the road ahead for Caterpillar will not be easy.

According to Caterpillar, sales from its Resource Industries division, which serves the mining sector and is the company's largest, are expected to plunge 40% this year. The company's other businesses, Power Systems and Construction Industries aren't doing great either. Sales in both divisions are expected to fall 5% in 2013, though these businesses should hold their own if the economy doesn't falter.

Mining giants such as Rio Tinto (NYSE:RIO) and BHP Biliton (NYSE:BHP) are slashing their capital expenditures because of weak commodities prices, which many analysts expect to continue. Both Goldman Sachs and Credit Suisse Group expect gold prices to continue their losses into 2014, according to Bloomberg News. The declines in gold are expected to pull down prices for silver. UBS expects the metal to fetch an average of $24 an ounce, down 17.2% from an earlier forecast in 2013 and $25 in 2014 (16.7% lower from a previous estimate). Earlier this month, Chile raised its estimate for the global surplus of copper by 40%. The largest copper producer expects prices in 2014 to fall to $3.15 per pound versus $3.15 in 2013, according to Reuters.

The Bottom Line

Caterpillar is the type of stock that illustrates Warren Buffett's famous quote "be fearful when others are greedy and greedy when others are fearful." There are many examples of stocks that people have left for dead that have roared back. Many pundits argued that Best Buy was stuck in a race for customers with Amazon that i! t couldn't win. Netflix was written off after angering customers with an ill-advised price increased. Both have surged more than 200% this year. Though no one can predict that Caterpillar will equal that performance, the stock should do better than it is today.

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

After iPad Air, will Apple make an iPad Pro?

The biggest news from Apple's product launch event Tuesday was the new name for the company's flagship 9.7 inch tablet, the iPad Air.

The name is fueling speculation that Apple may be developing a high-end tablet called an iPad Pro for work tasks that are currently performed on PCs.

"The name change is likely intentional. Everything that Apple articulates it does for a reason," said Will Power, an analyst at RW Baird. "Developing an iPad that is better designed for productivity is something that could very well make sense."

Apple already makes this distinction with its line of laptop and notebook computers, calling the slimmer version the MacBook Air and the more expensive, heavier-duty model the MacBook Pro. It also offers a Mac mini, a small desktop computer, and uses that word to describe the 7.9 inch iPad.

"This would seem to leave room for a 'Pro' model at some point if a market for a higher performance tablet exists," Gene Munster, an analyst at Piper Jaffray, wrote in a note to investors after Apple unveiled the iPad Air Tuesday.

There may well be a huge market for a tablet that can do most of the tasks office workers need to get done, such as word processing, creating presentations and crunching numbers in spreadsheets.

This year, more than 300 million PCs are expected to ship, compared to just over 180 million tablets, according to Gartner estimates.

Apple has sold 170 million iPads so far and most of these devices are used for "consumptive purposes" such as playing games and watching video, rather than productivity, RW Baird's Power noted.

"Put that 170 million number in the context of the number of PCs out there," the analyst said. "There's still a significant growth opportunity for tablets and Apple is trying to find ways to further segment the market."

Apple spokeswoman Trudy Muller declined to comment.

Hot Oil Companies To Own In Right Now

We entered a trade last week on the expectation that if odds continued to strengthen that the U.S. will not attack Syria, the added risk premium would be priced out of longer dated options on oil futures contracts. We looked at a November short vertical call spread as one way to trade this expectation.

Since then, November WTI crude has fallen to $104.71, which benefited the short call spread because of the bearish price bias in the trade. But just as significant was the reaction in options markets.

 IV November CL Options Source: Condor Options View Chart �/p>

 

The darker blue line shows the implied volatility for November CL options on September 12th, with the same volatility skew a few sessions later in light blue. The bid in out of the money call options dropped almost a full volatility point in some cases, and that means we can exit the options spread having collected most of the possible profit in a much faster time frame than would have been possible if we were relying on price changes alone.

Trades: BTC LOX3 November 114 calls at $0.28 and STC LOX3 November 116 calls at $0.17.

The trade collected $0.30 to open and costs $0.11s to exit, for a return of 11% on capital risked in less than a week.

OptionsProfits can be followed on Twitter at twitter.com/OptionsProfits

Jared can be followed on Twitter at twitter.com/CondorOptions

Hot Oil Companies To Own In Right Now: National-Oilwell Inc.(NOV)

National Oilwell Varco, Inc. designs, constructs, manufactures, and sells systems, components, and products used in oil and gas drilling and production; provides oilfield services and supplies; and distributes products, and provides supply chain integration services to the upstream oil and gas industry worldwide. Its Rig Technology segment offers offshore and onshore drilling rigs; derricks; pipe lifting, racking, rotating, and assembly systems; rig instrumentation systems; coiled tubing equipment and pressure pumping units; well workover rigs; wireline winches; wireline trucks; cranes; and turret mooring systems and other products for floating production, storage and offloading vessels, and other offshore vessels and terminals. The company?s Petroleum Services & Supplies segment provides various consumable goods and services to drill, complete, remediate, and workover oil and gas wells and service pipelines, flowlines, and other oilfield tubular goods. It also manufacture s, rents, and sells products and equipment for drilling operations, including drill pipe, wired drill pipe, transfer pumps, solids control systems, drilling motors, drilling fluids, drill bits, reamers and other downhole tools, and mud pump consumables. In addition, this segment provides oilfield tubular services comprising the provision of inspection and internal coating services; equipment for drill pipe, line pipe, tubing, casing, and pipelines; and coiled tubing pipes and composite pipes. Its Distribution Services segment sells maintenance, repair and operating supplies, and spare parts to drill site and production locations. The company primarily serves drilling contractors, shipyards and other rig fabricators, well servicing companies, pressure pumping companies, oil and gas companies, supply stores, and pipe-running service providers. National Oilwell Varco, Inc. was founded in 1862 and is based in Houston, Texas.

Advisors' Opinion:

• [By Matt DiLallo]

  Top stock No. 3: The supplier
  National Oilwell Varco (NYSE: NOV  ) just might be the safest name on this list. Risk here is mitigated as the company has no direct commodity price exposure, while its leading market share and worldwide operations provide an extra layer of cushion. This pick-and-shovel approach to the worldwide oil and gas drilling boom means that National Oilwell Varco can continue to sell its wares no matter where drillers find the next sources of oil and gas. Those are just some of the many reasons I made it my top stock to buy this month.�

• [By Rick Munarriz]

  National Oilwell Varco (NYSE: NOV  ) , a maker of oil and gas drilling and oilfield services equipment, doubled its quarterly dividend to $0.26 a share.

• [By David Smith]

  So it appears to be with National Oilwell Varco (NYSE: NOV  ) , of late the darling of the oilfield services sector. On Friday, however, it was the purveyor of news that its first-quarter 2013 results had fallen well below the consensus expectations of those who watch it most closely.

• [By Harlan Kessler]

  Whenever you see a company that is undervalued with plenty of competitive advantages and financial strength, you are looking at a winner. The company that meets these specifications in the energy business is National Oilwell Varco (NOV). The company supplies drillers and producers with anything they need ranging from rigs to drilling parts and also provides a range of services, whether it is piping inspection or the training of drilling crew in the use of sophisticated systems. It exerts such a profound influence that, according to a Morningstar estimate, it has a 60% share in the market for rig equipment and 90% of all rigs carry some of its equipment. It also operates in over 700 locations across the world. We should remember that the folks who made the real money in the Gold Rush were the suppliers of picks and shovels.

Hot Oil Companies To Own In Right Now: Midstates Petroleum Company Inc (MPO)

Midstates Petroleum Company, Inc. is an independent exploration and production company. The Company�� areas of operation include Pine Prairie, South Bearhead Creek/Oretta, West Gordon and North Cowards Gully. Its Upper Gulf Coast Tertiary trend extends from south Texas to Mississippi across its operating areas in central Louisiana. As of December 31, 2011, it had accumulated approximately 77,100 net acres in the trend. As of December 31, 2011, its development operations are focused in the Wilcox interval of the trend. The Company�� business is conducted through Midstates Petroleum Company LLC, as a direct, wholly owned subsidiary. In September 2012, the Company and its subsidiary acquired all of Eagle Energy Production, LLC�� producing properties as well as their developed and undeveloped acreage primarily in the Mississippian Lime oil play in Oklahoma and Kansas.

As of December 31, 2011, it drilled 57 gross wells in the trend, approximately 93% of. During the year ended December 31, 2011, its average daily production were 7,499 barrels of oil equivalent per day. As of December 31, 2011, it had a total of 974 gross vertical drilling locations, including 115 related to acreage under option, in the trend. As of December 31, 2011, the Company�� properties included approximately 92 gross active producing wells, 95% of, which it operate, and in which it held an average working interest of approximately 99% across its 77,100 net acre leasehold. During March 31, 2012, the Company continued its drilling program, spudding 14 wells, of which nine are producing, three are being drilled and two are waiting to be completed. As of December 331, 2011, it averaged daily production is approximately 9,000 barrels of oil equivalent per day.

Pine Prairie

The Company�� properties in the Pine Prairie area represented 46% of its total proved reserves as of December 31, 2011. During 2011, the Company�� average production from these properties was 3,793 net barrels of oil equ! ivalent per day, consisting of 2,143 barrels of oil, 565 barrels of natural gas liquidations (NGLs) and 6,508 million cubic feet of natural gas per day. As of December 31, 2011, it held an average working interest and average net revenue interest of 92.2% and 68.9%, respectively, on its acreage in Pine Prairie area. The Company has an additional 194 identified drilling locations in this area based primarily on 10-acre spacing.

South Bearhead Creek/Oretta

The Company�� properties in the South Bearhead Creek/Oretta area represented 20.3% of its total proved reserves as of December 31, 2011. During 2011, the Company�� average production from these properties was 4,367 net barrels of oil equivalent per day, consisting of 2,196 barrels of oil, 438 barrels of NGLs and 10,396 million cubic feet of natural gas per day. During 2011, these wells produced at an average daily rate of 2,413 net barrels of oil equivalent per day. As of December 31, 2011, it held an average working interest and average net revenue interest of 100% and 78.5%, respectively, on its acreage in South Bearhead Creek/Oretta area. The Company has an additional 43 identified drilling locations in this area based primarily on 40-acre spacing.

West Gordon

The Company�� properties in the West Gordon area represented 21% of its total proved reserves as of December 31, 2011. During 2011, the Company�� average production from these properties was 1,002 net barrels of oil equivalent per day, consisting of 617 barrels of oil, 68 barrels of NGLs and 1,901 million cubic feet of natural gas per day. As of December 31, 2011, it held an average working interest and average net revenue interest of 95.9% and 71.2%, respectively, on its acreage in West Gordon area. The Company has an additional 74 identified drilling locations in this area based primarily on 40-acre spacing.

North Cowards Gully

The Company�� properties in the North Cowards Gully area represented 11.5% of ! its total! proved reserves as of December 31, 2011. During 2011, the Company�� average production from these properties was 149 net barrels of oil equivalent per day consisting of 103 barrels of oil, 11 barrels of NGLs, and 211 million cubic feet of natural gas per day. As of December 31, 2011, it held an average working interest and average net revenue interest of 94.3% and 71.2%, respectively, on its acreage in North Cowards Gully area. The Company has an additional 95 identified drilling locations in this area based primarily on 40-acre spacing.

Advisors' Opinion:

• [By The Energy Report]

  Onshore, my favorite play is the Utica Shale, in which my top plays are Gulfport Energy Corp. (GPOR) and Rex Energy Corp. (REXX). Both companies have highly economic acreage, solid balance sheets and industry-leading production growth. I also like Rex Energy for its likely production upside. Another one of my favorite plays is the Eagle Ford Shale, in which my top plays are Penn Virginia Corp. (PVA) and Sanchez Energy Corp. (SN). Both have core acreage in the region, improving operating results and experienced management. Another favorite name of mine is Midstates Petroleum Co. Inc. (MPO). The company has assets in three solid plays and a management team with a long successful track record. Those are my favorite names at this time.

• [By Roberto Pedone]

  One energy player that's starting to move within range of triggering a major breakout trade is Midstates Petroleum (MPO), an independent exploration and production company focused on the application of modern drilling and completion techniques to oil-prone resources. This stock is off to a rough start in 2013, with shares off by 30%.

  If you look at the chart for Midstates Petroleum, you'll notice that this stock has recently come out of a nasty downtrend that took shares from over $8 to its low of $4.26 a share. Shares of MPO have started to find some buying interest over the last month at $4.44, 4.26 and $4.48 a share, as the stock has held those levels on recent pullbacks. This could be signaling that a bottom is forming for MPO, since the downside volatility looks over. Shares of MPO are now rebounding strong off those support levels and are quickly moving within range of triggering a major breakout trade.

  Traders should now look for long-biased trades in MPO if it manages to break out above some near-term overhead resistance levels at $4.82 a share and then once it takes out its 50-day moving average at $5.30 a share with high volume. Look for a sustained move or close above those levels with volume that hits near or above its three-month average action of 542,939 shares. If that breakout triggers soon, then MPO will set up to re-test or possibly take out its next major overhead resistance levels at $6 to its 200-day moving average of $6.54 a share.

  Traders can look to buy MPO off any weakness to anticipate that breakout and simply use a stop that sits right below some key near-term support levels at $4.48 or $4.26 a share. One can also buy MPO off strength once it takes out those breakout levels with volume and then simply use a stop that sits a comfortable percentage from your entry point.

10 Best Blue Chip Stocks To Buy Right Now: American Petro-Hunter Inc (AAPH)

American Petro-Hunter Inc., incorporated on January 24, 1996, is an oil and natural gases exploration and production company with projects in Kansas and Oklahoma. As of March 15, 2012, the Company has two producing wells in Kansas and six producing wells in Oklahoma. The Company also has rights for the exploration and production of oil and gas on an aggregate of approximately 6,230 acres in those states. On January 4, 2011, the Company announced plans to drill the NOS227 Well as a direct offset to the NOJ26 Well.

On March 25, 2011, the Company announced that the Company had acquired a working interest in an additional 2,000 acres located in Payne County in northern Oklahoma, near the Company�� Yale Prospect. The project has been named North Oklahoma Mississippi Lime Project. On May 16, 2011, the Company announced that drilling operations had commenced at the Company�� first horizontal well, NOM1H. The Company owns a 25% Working Interest in the lease. On June 29, 2011, the Company announced that NOM1H had begun commercial production. On July 18, 2011, the Company announced drilling plans for a total of 11 horizontal wells at the North Oklahoma Project. On July 20, 2011, the Company announced the acquisition of a 40% working interest in the South Oklahoma Project on 3,000 acres of land in south-central Oklahoma.

On February 6, 2012, the Company announced that the Company had drilled a total of 1,988 feet in the horizontal well segment penetrating into the 100 plus foot thick Mississippi pay zone. As of March 2012, there are nine locations left to drill on the acreage. The Company's crude oil production is sold to N.C.R.A. in MacPherson Kansas and Sunoco in Oklahoma. The Company sells natural gas through such pipeline to DCP Midstream, LP of Tulsa, Oklahoma.

Hot Oil Companies To Own In Right Now: Magellan Midstream Partners L.P.(MMP)

Magellan Midstream Partners, L.P., together with its subsidiaries, engages in the transportation, storage, and distribution of refined petroleum products and crude oil in the United States. Its pipeline system transports petroleum products and liquefied petroleum gases from the Gulf Coast refining region of Texas through the Midwest to Colorado, North Dakota, Minnesota, Wisconsin, and Illinois. The company owns and operates marine terminals, which store and distribute refined petroleum products, blendstocks, crude oils, heavy oils, and feedstocks, as well as inland terminals that consist of storage tanks connected to third-party interstate pipeline systems to deliver refined petroleum products. Its ammonia pipeline system transports ammonia from production facilities in Texas and Oklahoma to terminals in the Midwest. The company also stores, blends, and distributes biofuels, such as ethanol and biodiesel. As of March 31, 2011, it operated approximately 9, 600 miles of petr oleum products pipeline system and 51 terminals; 6 marine petroleum terminals located along the United States Gulf and East Coasts; a crude oil storage in Cushing, Oklahoma; 27 petroleum products inland terminals located principally in the southeastern United States; and a 1,100-mile ammonia pipeline system and 6 associated terminals. The company also provides ancillary services, such as heating, blending, and mixing of stored petroleum products and additive injection services. Its customers comprise independent and integrated oil companies, wholesalers, retailers, railroads, airlines, and regional farm co-operatives. The company serves various markets, including retail gasoline stations, truck stops, farm co-operatives, railroad fueling depots, and military and commercial jet fuel users. Magellan GP, LLC serves as the general partner of the company. The company was founded in 2000 and is based in Tulsa, Oklahoma.

Advisors' Opinion:

• [By WilliamBriat]

  
  On September 17, Magellan Midstream Partners L.P. (NYSE: MMP) and El Paso Pipeline Partners, L.P. (NYSE: EPB) touched three-month lows while oil was still spiking near a two-year high.

Hot Oil Companies To Own In Right Now: Halcon Resources Corp (HK)

Halcon Resources Corporation (Halcon Resources), incorporated on February 5, 2004, is an independent energy company focused on the acquisition, production, exploration and development of onshore liquids-rich oil and natural gas assets in the United States. The Company has oil and natural gas reserves located primarily in Texas, North Dakota, Louisiana, Oklahoma and Montana. On August 1, 2012, the Company acquired GeoResources by merger. On December 6, 2012, the Company completed the acquisition of entities owning approximately 81,000 net acres prospective for the Bakken / Three Forks formations primarily located in Williams, Mountrail, McKenzie and Dunn Counties, North Dakota (the Williston Basin Assets), from Petro-Hunt, L.L.C. and Pillar Energy, LLC (the Petro-Hunt parties). As of December 31, 2012, the Company has working interests in approximately 128,000 net acres prospective for the Bakken / Three Forks formations in North Dakota and Montana.

The Company�� Woodbine / Eagle Ford acreage is prospective for the Woodbine, Eagle Ford and other formations, with targeted depths ranging anywhere from 7,000 feet to 10,400 feet. As of December 31, 2012, The Company has approximately 198,000 net acres leased or under contract primarily in Leon, Madison, Grimes, Brazos, and Polk Counties, Texas. The Company is the operator and has a 100% working interest in more than 12,000 net acres in Wichita and Wilbarger Counties, Texas that it is actively water flooding in shallow Cisco aged Pennsylvania sandstone and limestone reservoirs. As of December 31, 2012, the Company produced 484 million barrels of oil equivalent from approximately 700 active producing wells and approximately 230 active water injection wells.

The Company�� position in the La Copita Field covers 3,720 gross acres and 2,829 net acres in Starr County, Texas. As of December 31, 2012, the Company�� average net daily production was 623 barrels of oil equivalent per day. The Company operates 100% of this production a! nd its working interest ranges from 75% to 100%. The Company has various other oil and natural gas properties with varying working interests located across the United States, including the Austin Chalk Trend and Eagle Ford Shale in Texas, the Fitts-Allen Fields in Central Oklahoma, and various other areas across South Louisiana, Montana, North Dakota, New Mexico, and West Virginia.

Advisors' Opinion:

• [By Value Digger]

  A) Halcon Resources (HK) is a US-based oil-weighted producer. I was bearish on Halcon at $8 when I shorted it, for the reasons mentioned here. I also noted then that the traders and the speculators pushed Halcon to an outrageous overvaluation at $8.

• [By Joel South and Taylor Muckerman]

  In this video, Motley Fool energy analysts Joel South and Taylor Muckerman look at Halcon (NYSE: HK  ) , one E&P company that was hit hard yesterday, as GDP news out of China meant commodities were dealt a painful blow across the board. Joel tells us about some of this company's upcoming expansion efforts and why he loves them overall, and why the sell-off this week could be a great time to buy.

• [By Selena Maranjian]

  Among holdings in which Tocqueville increased its stake were Molycorp (NYSE: MCP  ) and Halcon Resources (NYSE: HK  ) . Molycorp has been struggling in a tough environment and recently worried investors with a surprisingly large share offering and debt issuance. (Some worry about further capital needs, too, and worry about it running out of money before the market for its rare-earth minerals turns around.) Still, for those who can accept considerable risk and volatility, there's some promise in Molycorp, in part because of its acquisition of Neo Materials Technologies and its potential to become a powerful low-cost producer.

• [By Jeremy Bowman]

  What: Shares of Halcon Resources (NYSE: HK  ) were flowing in the wrong direction today, falling as much as 15% after reporting earnings this morning.

Hot Oil Companies To Own In Right Now: Noble Corp (NE)

Noble Corporation is an offshore drilling contractor for the oil and gas industry. The Company performs contract drilling services with its fleet of 79 mobile offshore drilling units and one floating production storage and offloading unit (FPSO) located globally. As of December 31, 2011, its fleet consisted of 14 semisubmersibles, 14 drillships, 49 jackups and two submersibles. Its fleet includes 11 units under construction, which include five ultra-deepwater drillships, and six jackup rigs. As of February 15, 2012, approximately 84% of its fleet was located outside the United States in areas, which included Mexico, Brazil, the North Sea, the Mediterranean, West Africa, the Middle East, India and the Asian Pacific. During the year ended December 31, 2011, it completed construction on the Noble Bully I, a drillship, owned through a joint venture with a subsidiary of Royal Dutch Shell plc; completed construction on the Noble Bully II, a drillship, and it completed construction of Globetrotter-class drillship. As of February 15, 2012, it had 10 rigs under contract in Mexico with Pemex Exploracion y Produccion (Pemex).

During 2011, the Company conducted offshore contract drilling operations, which accounted for over 98% of its operating revenues. It conducts its contract drilling operations in the United States Gulf of Mexico, Mexico, Brazil, the North Sea, the Mediterranean, West Africa, the Middle East, India and the Asian Pacific. During 2011, revenues from Shell and its affiliates accounted for approximately 24% of its total operating revenues. During 2011, revenues from Petroleo Brasileiro S.A. (Petrobras) accounted for approximately 18% and 19% of its total operating revenues. Revenues from Pemex accounted for approximately 15%, 20% and 23% of its total operating revenues.

Semisubmersibles

Semisubmersibles are floating platforms which, by means of a water ballasting system, can be submerged to a predetermined depth so that a substantial portion of the hull is b! elow the water surface during drilling operations. As of December 31, 2011, the semisubmersible fleet consisted of 14 units, including five Noble EVA-4000 semisubmersibles; three Friede & Goldman 9500 Enhanced Pacesetter semisubmersibles; two Pentagone 85 semisubmersibles; two Bingo 9000 design unit submersibles; one Aker H-3 Twin Hull S1289 Column semisubmersible, and one Offshore Co. SCP III Mark 2 semisubmersible.

Drillships

The Company�� drillships are self-propelled vessels. These units maintain their position over the well through the use of either a fixed mooring system or a computer controlled dynamic positioning system. Its drillships are capable of drilling in water depths from 1,000 to 12,000 feet. The maximum drilling depth of its drillships ranges from 20,000 feet to 40,000 feet. As of December 31, 2011, the drillship fleet consisted of 14 units, including four drillships under construction with Hyundai Heavy Industries Co. Ltd. (HHI); three Gusto Engineering Pelican Class drillships; two Bully-class drillships to be operated by it through a 50% joint venture with a subsidiary of Shell; one dynamically positioned Globetrotter-class drillship that left the shipyard during the fourth quarter of 2011; one Globetrotter-class drillship under construction; one moored Sonat Discoverer Class drillship capable of drilling in Arctic environments; one NAM Nedlloyd-C drillship, and one moored conversion class drillship.

Jackups

As of December 31, 2011, the Company had 49 jackups in its fleet, including six jackups under construction. The rig hull includes the drilling rig, jacking system, crew quarters, loading and unloading facilities, storage areas for bulk and liquid materials, helicopter landing deck and other related equipment. All of its jackups are independent leg and cantilevered. Its jackups are capable of drilling to a maximum depth of 30,000 feet in water depths up to 400 feet.

Submersibles

The Company has two su! bmersible! s in the fleet, which are cold-stacked. Submersibles are mobile drilling platforms, which are towed to the drill site and submerged to drilling position by flooding the lower hull until it rests on the sea floor, with the upper deck above the water surface. Its submersibles are capable of drilling to a depth of 25,000 feet in water depths up to 70 feet.

Advisors' Opinion:

• [By Shauna O'Brien]

  On Tuesday, UBS reported that it has raised its estimates on offshore drilling contractor Noble Corporation (NE).

  The firm has increased 2014 estimates on NE due to its five new jackup contracts. UBS currently has a $41 price target on NE. This price target suggests a 4% increase from the stock’s current price of $39.35.

  Noble Corporation shares were mostly flat during pre-market trading Tuesday. The stock is up 13% YTD.

• [By Matt DiLallo]

  What Seadrill does see for small and midsized companies is that these operators will look to sign short-term contracts for exploration drilling. Larger companies like BP will counterbalance this with long-term drilling campaigns. Overall, Seadrill expects oil companies to continue to increase their budgets and spending on ultra-deep water by double digits. The company sees a strong trend here which also bodes well for competitors such as Noble Corp (NYSE: NE  ) and Transocean (NYSE: RIG  ) .

• [By Matt DiLallo]

  Take Noble Energy (NYSE: NBL  ) and Noble Corp (NYSE: NE  ) . If you look at the ticker symbol of each company, you can see how easy it would be to confuse the two. So before you submit that buy order, let's drill down into each company so you can see why you'd want to double check before submitting that buy order.

• [By Double Dividend Stocks]

  London-based Ensco plc, (ESV), provides offshore contract drilling services to the oil and gas industry worldwide, and operates a drilling rig fleet of approximately 74 rigs, including 9 drill ships, 13 dynamically positioned semisubmersible rigs, 6 moored semisubmersible rigs, and 46 jackup rigs. ESV currently has the world's second largest offshore rig fleet, behind only Transocean, which has 95 rigs, and just ahead of Noble, (NE), which has 73 rigs. Ensco has the newest fleet of Ultradeepwater rigs, with 3, and, has 4 more on order, which are already contracted.

Hot Oil Companies To Own In Right Now: Stone Energy Corporation(SGY)

Stone Energy Corporation, an independent oil and natural gas company, engages in the acquisition, exploration, exploitation, development, and operation of oil and gas properties in the Gulf of Mexico and the Appalachia region. As of December 31, 2010, it had estimated proved oil and natural gas reserves of approximately 473.9 billion cubic feet of gas equivalent. The company was founded in 1993 and is headquartered in Lafayette, Louisiana with additional offices in New Orleans, Louisiana; Houston, Texas; and Morgantown, West Virginia.

Advisors' Opinion:

• [By Caiman Valores]

  But its reserves are lower than U.S. domiciled small-cap Stone Energy (SGY) and mid-cap Whiting Petroleum (WLL). However, in the case of Stone Energy a larger portion of its proved and probable reserves are lower margin and less profitable natural gas, with natural gas making up 51% of its reserves and oil and NGLs the remaining 49%.

Hot Oil Companies To Own In Right Now: Gastar Exploration Ltd (GST)

Gastar Exploration Ltd (Gastar) is an independent energy company engaged in the exploration, development and production of natural gas and oil in the United States. The Company�� principal business activities include the identification, acquisition, and subsequent exploration and development of natural gas and oil properties with an emphasis on unconventional reserves, such as shale resource plays. As of December 31, 2011, it is pursuing the development of liquids-rich natural gas in the Marcellus Shale in the Appalachia area of West Virginia and, to a lesser extent, central and southwestern Pennsylvania. The Company also holds prospective acreage in the deep Bossier play in the Hilltop area of East Texas and conduct limited coal bed methane (CBM) development activities within the Powder River Basin of Wyoming and Montana. The Company is a holding company. Advisors' Opinion:

• [By David Smith]

  Earlier, the company had pocketed $75.2 million by selling to Gastar Exploration (NYSEMKT: GST  ) leasehold acreage in Oklahoma's Kingfisher and Canadian counties. It'll obviously require a passel of sales of that magnitude to shore up an overweight balance sheet.

Will Economic Growth Uncertainty Stop Taper Again?

The more uncertain the economic climate feels, the more likely the Fed will continue to delay tapering, writes MoneyShow's Jim Jubak, also of Jubak's Picks, and continue driving bonds and bond proxy stocks up.

With the shutdown/debt ceiling crisis behind us, the stock market is free to worry about a slowdown in US economic growth and to hope for a delay in the Federal Reserve's taper until sometime in 2014.

That's pushing the US market away from growth-sensitive stocks and toward what James Mackintosh of the Financial Times called "bond proxies" on Friday.

That means stocks with safe dividends that won't be cut, even if the economy stumbles.

Thursday's market leaders were telecom stocks (up 1.7%), utilities (up 1.6%), and consumer staples (up 0.8%) on a day when the Standard & Poor's 500 stock index (SPX) climbed just 0.67%.

The worry here, of course, is that a US economy that wasn't growing fast enough for the Fed to begin to withdraw any of it stimulus, even before the shutdown/debt ceiling crisis, will show even slower growth in the fourth quarter because of that crisis. And that the damage will extend into 2014 because we're scheduled to revisit the shutdown and debt ceiling battles in January and February of 2014.

The hope—for bonds themselves and bond proxy stocks—is that uncertainty about economic growth will keep the Fed from beginning to taper off its $85 billion a month in purchases of Treasuries and mortgage-backed assets until January, or maybe even March or April. That kind of delay would continue the post-crisis rally in Treasuries that sent the yield on the 10-year Treasury to 2.59% on Friday, from slightly above 3% in early September. Falling yields make the payouts from bond proxy stocks more valuable. For example, eight of the 12 stocks in my dividend income portfolio were up Friday, as of 2:15 PM New York time. Verizon (VZ), which isn't part of that portfolio, was up 1.57% Friday.

How long this goes on will depend on how long the markets remain convinced that the Fed will delay beginning its taper. The Fed's Open Market Committee, which will make that decision, meets on October 30 and then on December 18. Just about no one believes the Fed will have enough data to decide to begin the taper on October 30, and the betting now is, that the Fed won't taper on December 18 either.

The timing of the Fed's calendar does mean that the markets won't know they're wrong—if they are—until the middle of December. The Fed recognizes this and if it intends to taper in December, you should hear signals loud and strong from the central bank before that, because the last thing the Fed wants is to surprise the financial markets at this point.

My opinion is that we won't hear those taper signals in December.

Full disclosure: I don't own shares of any of the companies mentioned in this post in my personal portfolio. When in 2010 I started the mutual fund I manage, Jubak Global Equity Fund, I liquidated all my individual stock holdings and put the money into the fund. The fund may or may not now own positions in any stock mentioned in this post. The fund did not own shares of any company mentioned in this post as of the end of June. For a full list of the stocks in the fund as of the end of June see the fund's portfolio here.

The 3 Deadliest Diseases Caused by Smoking

Unless you've been hiding under a rock, you're probably well aware of the dangers associated with smoking tobacco and have witnessed the increasing efforts of the Centers for Disease Control and Prevention to step up its educational efforts over the past two decades.

The good news is that the number of smokers in the United States is on the decline, with just 19% of U.S. adults listed as current smokers by the CDC.

Source: Centers for Disease Control and Prevention.

Targeted advertising that's graphic, educational, and focused on America's youth has instilled the dangers of smoking into much of the younger generation. The CDC, for example, kicked off its first-ever anti-smoking television campaign last year, spending $54 million over the course of three months with the express purpose of causing at least 50,000 people to quit.

Source: Linus Bohman, Flickr.

The reason to encourage smokers to quit is much more than "it's just bad for you"; scientifically and economically it's been shown that smoking can affect our friends and family and harm productivity in the workplace. Secondhand smoke, for instance, has been shown to increase the probability that our friends and family will develop a disease directly caused by cigarette smoke inhalation. In addition, U.S. businesses lose about $97 billion in productivity each year because of disease-related complications caused by cigarette smoking. Keep mind this figure is just based on productive work-lives shortened by cigarette smoking and doesn't include lost production because of disability and sick days.

However, nothing stands out as more glaring than the deaths that are directly attributable to cigarette smoking -- an average of 443,000 annually between 2000 and 2004, according to the CDC. Today I propose to examine the three most deadly diseases caused by cigarette smoking and analyze what medications are available to help treat those diseases.

Cancer
This is something of a no-brainer, but cancer was responsible for 164,200, or 37%, of the total deaths attributable to cigarette smoking. If you recall, smoking was practically a universal risk factor across the board when I examined the 12 most commonly diagnosed cancers in the Tackling Cancer series earlier this year.

Of the attributed smoking deaths associated with cancer, none is more virulent than lung cancer which singlehandedly claimed an average of 128,900 lives annually between 2000 and 2004. Based on the CDC's statistics, the risk of developing lung cancer by smoking cigarettes increases by a factor of 23 for men and 13 for women relative to non-smokers, while five-year survival rates for lung cancer sit at just a dismal 12%.

Perhaps no drug is more widely used in lung cancer treatment than Roche's Avastin. Roche's wonder drug is an angiogenesis inhibitor, simply meaning that it inhibits the growth of blood vessels to tumors in the hope of starving a solid tumor of the oxygen needed for it to grow. When Avastin was approved in 2006, it improved median overall survival in patients to 12.3 months from 10.3 for the control arm. Relatively speaking, though, we need to do a lot better than just 12.3 months! 

The next step in lung cancer care treatment may come from the likes of Bristol-Myers Squibb's nivolumab or Merck's (NYSE: MRK  ) lambrolizumab. Both of these drugs are known as PD-1 inhibitors which have shown reasonably high overall response rates in clinical trials – 40% for nivolumab and 38% for lambrolizumab – and could represent the next treatment pathway for lung cancer patients. Nivolumab is currently in six in late-stage trials, including the treatment of non-small-cell lung cancer, while Merck's lambrolizumab has received the rare breakthrough therapy designation from the FDA, which could help streamline its approval if it continues to provide a huge statistical benefit in trials over existing treatments. 

Ischemic heart disease
Closely trailing cancer as the most deadly smoking-related cause of death is ischemic heart disease, which was responsible for 126,000, or 28%, of all deaths. Ischemic heart disease is a condition in which the heart doesn't receive enough blood flow, which can be caused by a number of factors, including high blood pressure (hypertension), high cholesterol, and diabetes. Once again, and as no surprise, smoking is a major risk factor for developing all three diseases!

Unlike a cancer diagnosis, which pretty specifically cued in on lung cancer relative to all other cancer diagnoses combined by a margin of greater than 3-to-1, ischemic heart disease can develop as a result of any one, or a combination of, the aforementioned diseases. This means that in addition to quitting smoking, and living an active life with a proper diet, certain medications may be called upon to help regulate a person's cardiovascular system.

Novartis' Diovan, for example, is a widely prescribed treatment for helping patients with high blood pressure. Diovan is an angiotensin II receptor blocker, meaning that it prevents angiotensin from affecting blood vessels, ultimately relaxing them and allowing blood to flow more easily. Although Diovan lost its patent protection last year, no biosimilar version of the drug has made it to market as of yet. 

The new kid on the block in treating LDL-cholesterol (the bad type) is Liptruzet, a combination therapy of Pfizer's (NYSE: PFE  ) generic Lipitor and Merck's cholesterol absorption inhibitor, Zetia. Separately, these two drugs were effective at reducing LDL-cholesterol levels by 37% to 54%, and 20%, respectively. However, when combined the combination, known as Liptruzet, boosted the LDL-reducing effect to 53%-61%. It looks like the legend of Lipitor, the best-selling drug in history, will live on!

With regard to diabetes, it really just depends whether you're dealing with the genetic and rarer form of the disease, type 1 diabetes, or the much more common type 2 diabetes, whose onset is based on a number of factors that includes diet, activity level, and genetics. For the sake of argument -- and to take nothing away from type 1 diabetes patients, who recently had an encouraging discovery of their own -- Johnson & Johnson's (NYSE: JNJ  ) new SGLT-2 inhibitor, Invokana, looks to be the next big thing in type 2 diabetes treatment. Working in the kidneys instead of the liver or pancreas, Invokana allows the body to excrete excess glucose through the urine. Better yet, Invokana has also been shown to induce weight loss (which can be a good thing since a majority of diabetics are overweight) and reduce hypertension.

Chronic obstructive pulmonary disease
Not to be forgotten is chronic obstructive pulmonary disorder, better known as COPD, which was responsible for 92,900, or 21%, of all cigarette smoking-related deaths from 2000 to 2004. COPD is already the third-leading cause of death in the U.S., slightly ahead of stroke, and comes in two primary forms: chronic bronchitis, which is exhibited by a long-term cough with mucus production, and emphysema, an irreversible and progressive degradation of the lungs over time.

Perhaps the most exciting new treatment to hit the market in years was recently approved by the FDA. Developed by GlaxoSmithKline (NYSE: GSK  ) and Theravance (NASDAQ: THRX  ) , Breo Ellipta is a dry powder drug delivered by inhaler and meant to provide long-term relief of air-flow obstruction and reduce COPD exacerbations. The two companies are collaborating on a handful of potentially revolutionary new COPD treatments that combine Theravance's long-acting beta-2 agonists with Glaxo's long-acting muscarinic antagonists. Its next treatment, Breo Anoro, is currently under review by the FDA.

Source: Centers for Disease Control and Prevention.

The butt of the problem
The negative effects of cigarette smoking on our bodies is quite clear no matter where we look for our evidence. If you choose to smoke, your likelihood of developing one of these three deadly diseases, which were responsible for 86.5% of all smoking-related deaths, is greatly increased.

If we've learned anything here today, it's that quitting smoking could be one of the healthiest and smartest moves you ever make as it could drastically reduce your chances of developing a serious illness, and that tobacco is quite addictive -- otherwise, most people would have stopped smoking a long time ago. This means that while we are seeing a minimal reduction in the percentage of U.S. smokers, the need for medications to treat lung cancer, COPD, and various forms of ischemic heart disease aren't likely to slow anytime soon.

Obamacare will undoubtedly have far-reaching effects. The Motley Fool's new free report "Everything You Need to Know About Obamacare" lets you know how your health insurance, your taxes, and your portfolio could be affected. Click here to read more. 

Zillow Launches Platform to Help Agents, Buyers Communicate

Online real estate marketplace Zillow (NASDAQ: Z  ) has launched a new web and mobile co-shopping platform, Agentfolio, for direct communication among agents and homebuyers, the company announced today.

The platform is the result of Zillow's October 2012 buyout of collaborative shopping company Buyfolio, which is now called Agentfolio. Zillow says Agentfolio is the only platform for real estate that provides collaborative search options for multiple people. Zillow is offering the service for free among members of its Premier Agent program, and $25 a month for agents who are not subscribers. Zillow launched Agentfolio in Chicago and plans to roll it out in New York City, Boston, and other markets across the country.

Susan Daimler, Zillow's director of Agentfolio, said she believes the service will allow for more efficient communication in the processes of searching for and selling homes. "The home search has gotten too complicated for the inbox," she was quoted as saying. "Agentfolio provides a mobile and online workspace where agents and their clients can search, share, organize and discuss listings all in one place."

link

Currency-Hedged ETFs: Are They Right for You?

International investors have recently gotten a lot more interested in currency-hedged ETFs. But what are currency-hedged ETFs, and how can you decide whether they belong in your portfolio? (NYSEMKT: DXJ  )

In the following video, Fool contributor Dan Caplinger discusses the ins and outs of currency-hedged ETFs. As Dan notes, the strong performance of the Japanese stock market amid weakness in the Japanese yen led to a big surge in interest in currency hedging strategy. Yet Dan also points out that the currency hedge can work both ways with these ETFs, hurting results when the U.S. dollar is weak. Dan concludes with some examples of situations in which trying to hedge currency risk really doesn't make any sense.

One company that has exposure to currencies around the world is Philip Morris International. But given the surge in regulation around the world, is Philip Morris still a buy? Find out in The Motley Fool's premium research report on the company, which includes in-depth analysis of its opportunities and challenges ahead. To claim your report, just click here now.

The Next Big IPO?

The following video is from Thursday's MarketFoolery podcast, in which host Chris Hill, along with analysts Jason Moser and Isaac Pino discuss the top business and investing stories of the day.

According to reports, the Container Store is preparing for an IPO. The Container Store operates 59 stores, and did around 707 million in sales last year -- up 11% from 2011. Around six years ago, Container Store founders sold a majority stake to the private equity firm Leonard Green & Partners. How does the Container Store stack up against the competition? In this installment of MarketFoolery, our analysts talk the future of the retailer.

The retail space is in the midst of the biggest paradigm shift since mail order took off at the turn of last century. Only those most forward-looking and capable companies will survive, and they'll handsomely reward those investors who understand the landscape. You can read about the 3 Companies Ready to Rule Retail in The Motley Fool's special report. Uncovering these top picks is free today; just click here to read more.

The relevant video segment can be found between 10:57 and 16:27.

For the full video of today's MarketFoolery, click here.

Fi360 acquires technology platform for investment policy statements

Fi360 has acquired IPS AdvisorPro, a technology platform that helps financial advisers develop customized investment policy statements.

“We feel strongly that the implementation and maintenance of a high-quality IPS is critical for effective management of the investment process,” fi360 chief executive Blaine F. Aikin said in a statement. “The IPS AdvisorPro technology is the most effective solution available for developing custom IPS templates and managing them across clients.”

IPS Advisor Pro was developed by Norm Boone and Linda Lubitz Boone, experts on investment policy statements and authors of "Creating An Investment Policy Statement" (FPA Press, 2004). The technology allows users to develop templates for eight unique client types, including individuals, trusts, ERISA plans, foundations and endowments, charitable trusts, and irrevocable life insurance trusts. The templates are fully customizable.

Mr. Boone and Ms. Lubitz Boone will act as consultants to fi360 while continuing to lead their respective independent advisory firms.

Terms of the deal were not disclosed, but it marks the third acquisition for fi360 this year. In September, the company acquired Ann Schleck & Co., a consulting firm, and in January, it acquired Financial Service Standards, a firm that trains retirement plan advisers and develops practice management resources. fi360 provides investment fiduciary education, practice management and support.

Best Safest Stocks To Buy For 2014

The fallout from Detroit's bankruptcy filing has investors - and even ratings agencies - questioning the validity of the bond rating system.

Now investors need to know if it can be fixed in a way that actually helps those investing in general obligation (GO) bonds.

In June, Detroit Emergency Manager Kevyn Orr sent the financial equivalent of a nuclear blast through the muni bond markets when he stated that holders of Detroit's GO bonds - whose holdings total roughly $600 million - will be lumped together with other unsecured creditors who collectively account for $11 billion in city obligations.

Historically, GO bonds were seen as the safest form of municipal debt. That's because historically municipalities would raise taxes, cut services - do anything - rather than force losses on bondholders.

"The bottom line is, Orr said that these bonds are unsecured, which potentially forces a loss on these investments," explains Money Morning Chief Investment Strategist Keith Fitz-Gerald. "If that's the case, then here we go: those formerly secured debts are in fact no safer than junk bonds. Which means, all of a sudden, in the blink of an eye, all the ratings on municipalities everywhere are suspect."

Best Safest Stocks To Buy For 2014: Under Armour Inc.(UA)

Under Armour, Inc. develops, markets, and distributes performance apparel, footwear, and accessories for men, women, and youth primarily in the United States, Canada, and internationally. It offers products made from moisture-wicking synthetic fabrics designed to regulate body temperature and enhance performance regardless of weather conditions. The company provides its products in three fit types: compression (tight fitting), fitted (athletic cut), and loose (relaxed) extending across the sporting goods, outdoor, and active lifestyle markets. Its footwear offerings comprise football, baseball, lacrosse, softball, and soccer cleats; slides; performance training footwear; and running footwear. The company also provides baseball batting, football, golf, and running gloves, as well as licenses bags, socks, headwear, custom-molded mouth guards, and eyewear that are designed to be used and worn before, during, and after competition. Under Armour sells its products through retai l stores, as well as directly to consumers through its own retail outlets and specialty stores, Website, and catalogs. The company was founded in 1996 and is headquartered in Baltimore, Maryland.

Advisors' Opinion:

• [By Daniel Sparks]

  Competition
  Though Nike does boast impressive gross margins compared to its footwear competitors, three of them, Adidas, Puma, and Under Armour (NYSE: UA  ) , are large enough to cause some disruption in some of Nike's markets.

• [By Johanna Bennett]

  Investors also�bid up shares of Under Armour (UA) to $80.31, a 1.5% rise. And athletic-gear retailer Finish Line (FINL) jumped 7.3% to $24.02 following their own earnings homerun.

Best Safest Stocks To Buy For 2014: Goldman Sachs Group Inc.(The)

The Goldman Sachs Group, Inc., together with its subsidiaries, provides investment banking, securities, and investment management services to corporations, financial institutions, governments, and high-net-worth individuals worldwide. Its Investment Banking segment offers financial advisory, including advisory assignments with respect to mergers and acquisitions, divestitures, corporate defense, risk management, restructurings, and spin-offs; and underwriting securities, loans and other financial instruments, and derivative transactions. The company?s Institutional Client Services segment provides client execution activities, such as fixed income, currency, and commodities client execution related to making markets in interest rate products, credit products, mortgages, currencies, and commodities; and equities related to making markets in equity products, as well as commissions and fees from executing and clearing institutional client transactions on stock, options, and fu tures exchanges. This segment also engages in the securities services business providing financing, securities lending, and other prime brokerage services to institutional clients, including hedge funds, mutual funds, pension funds, and foundations. Its Investing and Lending segment invests in debt securities, loans, public and private equity securities, real estate, consolidated investment entities, and power generation facilities. This segment also involves in the origination of loans to provide financing to clients. The company?s Investment Management segment provides investment management services and investment products to institutional and individual clients. This segment also offers wealth advisory services, including portfolio management and financial counseling, and brokerage and other transaction services to high-net-worth individuals and families. In addition, it provides global investment research services. The company was founded in 1869 and is headquartered in New York, New York.

10 Best Heal Care Stocks To Own Right Now: Petroleo Brasileiro S.A.- Petrobras(PBR)

Petroleo Brasileiro S.A. primarily engages in oil and natural gas exploration and production, refining, trade, and transportation businesses. The company?s Exploration and Production segment involves in the exploration, production, development, and production of oil, liquefied natural gas (LNG), and natural gas in Brazil. This segment supplies its products to the refineries in Brazil, as well as sells surplus petroleum and byproducts in domestic and foreign markets. Its Supply segment engages in the refining, logistics, transportation, and trade of oil and oil products; export of ethanol; and extraction and processing of schist, as well as holds interests in companies of the petrochemical sector in Brazil. The Gas and Energy segment involves in the transportation and trade of natural gas produced in or imported into Brazil; transportation and trade of LNG; and generation and trade of electric power. In addition, the segment has interests in natural gas transportation and d istribution companies; and thermoelectric power stations in Brazil, as well engages in fertilizer business. The Distribution segment distributes oil products, ethanol, and compressed natural gas in Brazil. The International segment involves in the exploration and production of oil and gas, as well as in supplying, gas and energy, and distribution operations in the Americas, Africa, Europe, and Asia. Further, the company involves in biofuel production business. Petroleo Brasileiro was founded in 1953 and is based in Rio de Janeiro, Brazil.

Advisors' Opinion:

• [By Tyler Crowe]

  But there is one company that straddles the fence of NOC and investment opportunity and could be a major player in this surging oil trend: Petrobras (NYSE: PBR  ) . The state-run oil company of Brazil is required to have a 30% operator stake in every well drilled in offshore Brazil. This could be a huge benefit for a region that some estimate to have as many as 50 billion barrels of recoverable oil. Petrobras doesn't seem to be wasting any time taking advantage of its leader position for offshore exploration, either. The company plans to spend $237 billion in the next four years to make this happen. If the company can deliver on these lofty production goals both on time and within budget -- two major issues that have plagued the company in the past -- its position in Brazil offshore could mean promising times ahead for this stock.��

• [By Matt DiLallo]

  For perspective, estimates for Brazil's major offshore pre-salt reserves indicate the potential for 70-100 barrels of oil equivalent, or boe. The country's national oil company,�Petrobras� (NYSE: PBR  ) , is still in the early stages of developing those reserves; its current goal is to reach production of 1 million barrels of oil per day by 2016. However, the company is still in the process of collecting information and mapping the pre-salt region, a project that won't be complete until 2018. What that means is that this play has a long way to go until we know the full extent of the resource potential, but its already producing impressive results.�

Best Safest Stocks To Buy For 2014: Fluor Corporation(FLR)

Fluor Corporation, through its subsidiaries, provides engineering, procurement, construction, maintenance, and project management services worldwide. Its Oil & Gas segment offers design, engineering, procurement, construction, and project management services to upstream oil and gas production, downstream refining, chemicals, and petrochemicals industries. This segment also provides consulting services comprising feasibility studies, process assessment, and project finance structuring and studies. The company?s Industrial & Infrastructure segment offers design, engineering, procurement, and construction services to the transportation, wind power, mining and metals, life sciences, manufacturing, commercial and institutional, telecommunications, microelectronics, and healthcare sectors. Its Government segment provides engineering, construction, logistics support, contingency response, management, and operations services to the United States government focusing on the Departme nt of Energy, the Department of Homeland Security, and the Department of Defense. The company?s Global Services segment offers operations and maintenance, small capital project engineering and execution, site equipment and tool services, industrial fleet services, plant turnaround services, temporary staffing services, and supply chain solutions. Its Power segment provides engineering, procurement, construction, program management, start-up and commissioning, and operations and maintenance services to the gas fueled, solid fueled, plant betterment, renewables, nuclear, and power services markets. The company also offers unionized management and construction services in the United States and Canada. Fluor Corporation was founded in 1912 and is headquartered in Irving, Texas.

Advisors' Opinion:

• [By Louis Navellier]

  Fluor Corporation (FLR) is one of the world�� leading heavy construction and engineering firms. I don’t want to imply that this is a bad company because it is actually a very good one. However, Fluor has divisions including Oil & Gas, Industrial Infrastructure, Government, Global Services and Power. Virtually all of them are seeing limited spending as a result of the global slowdown and reduced government spending around the world. The stock is up more than 23% this year, but earnings are actually down on flat revenues. Analysts have been lowering their estimates for the rest of this year as well as 2014, and the stock is currently rated as a by Portfolio Grader. When the economy recovers, I expect will see this company’s fundamentals improve substantially … but until that happens investors should avoid the stock.

• [By Louis Navellier]

  If we look at the sector using Portfolio Grader, we see that many of the big names in the group like Flour (FLR), Granite Construction (GVA) and KBR incorporated (KBR) are rated ��ell.��The anticipated spending for both government and private industry simply hasn�� materialized, and the companies are not seeing revenue or profit growth.

• [By Rich Duprey]

  South America has become an unsettled region to mine in. Newmont Mining (NYSE: NEM  ) had its Peruvian Conga project brought to a short stop over environmental concerns, while Vale (NYSE: VALE  ) recently abandoned an Argentinean project because of the country's policies.�Costs for Pascua-Lama have ballooned over the past decade and now stand at about $8.5 billion, putting it at risk of becoming an albatross around the miner's neck even before the court decision. Barrick even resorted to bringing in engineering specialist Fluor (NYSE: FLR  ) to expand the scope of its project management before the court order.

New Mercedes S-Class: Pampering for pampered rich

The redesigned 2014 version of the Mercedes-Benz flagship S-Class sedan went on sale this week, backed by a marketing blitz that will be hard to miss, even though few of us can have such a lux-mobile on our shopping lists.

The ante starts at $93,825 with shipping for a "base" rear-drive S550 (on sale now), $96,825 for S550 with all-wheel drive M-B calls 4Matic (out next month). The performance S63 AMG model (also next month) starts at $140,425 with 4Matic now standard.

Who can spend that for a car, you ask? Says M-B, they are 76% male, 83% married, age 61 and make $371,000 per year. What those folks most also look at: BMW 7, Audi A8, Lexus LS.

But we'll all see a lot of S-Class ads starting this week. The costly buy for two launch ads by Merkley+Partners (NYC) ranges from broadcast entertainment shows -- such as Modern Family, Dancing with the Stars, Criminal Minds and Elementary -- to news and talk -- such as Nightline, Letterman, Jimmy Fallon and Meet the Press -- to sports, such as ESPN Monday Night Football and Sunday Night Football on NBC. Multiple cable channels get a slice, too. And there are print and digital ads.

The first TV ad, "Four Words," goes back 127 years to founder Gottlieb Daimler's garage and his slogan: "The Best or Nothing." It brings you forward through M-B racing trophies and winning race cars to modern design centers, factories and even crash testing. The second, a moody drive through a city nightscape, features the cornucopia of creature comforts that the S550 offers.

With the range of airings for the ads, M-B must assume that just seeing the S550 will make the rest of us more likely to buy, say, its new CLA sedan starting at about $30,000.

But don't kid yourself! . By "The Best," they clearly mean the S-Class. "No other car stands for the Mercedes-Benz brand promise more than the S-Class," Mercedes Chairman Dr. Dieter Zetsche said in July.

Here is a sampling of how you can treat yourself in an S550 for into six figures nicely equipped:

• Heated armrests. Heated front seats and now even heated rears and steering wheels are moving down the auto food chain, so this was the obvious next frontier for luxury.

• "Hot stone" massage. To mimic a hot-stone massage, Mercedes developed a programmable system with 14 separately actuated air cushions in the seat back that can work with the electric heating. Folks who have a driver -- or who have really pampered kids or pets -- also can order this for their rear seat.

• Aromatherapy air. The "Air Balance Package" filters and ionizes cabin air -- and scents it in your choice of flavors.

• Woofers in the firewall, not the doors. In an M-B first, the bass drivers in the firewall that use space in the cross and side pieces as the resonance chamber. Three sound systems are offered.

• Mood lighting. Optional ambient lighting for the interior provides soft accents all around in a choice of seven colors to suit your mood.

• A throne in the back. Up front it's nice, but M-B also wants to sell the S550 in markets where buyers routinely have a driver. They can order from a choice of rear seat packages that offer reclining up to 43.5 degrees, a foot rest, cupholders that heat or cool, folding tables and heat, ventilation and massage in the seat. You also get, of course, your own climate and entertainment controls and screens. The recliner even gets a special air bag to keep the occupant from sliding under his or her seat belt in a crash.

• Foot-long screens. The dash instruments and infotainment "command center" are displayed -- above the equally impressive big bank of AC vents -- on a pair of 12.3-inch widescreens.

• "Magic Body Control." We're not talking about the ma! ssage. Th! e option uses cameras see imperfections in the road ahead and continuously adjusts the suspension to handle them.

• No light bulbs. M-B says the S-Class is the world's first car with all-LED lighting inside and out. That requires about 500 LEDs for the exterior and interior lights if you include the ambient lighting.

• Safety systems that may be smarter than you are. Mercedes says the car offers more than 30 standard and optional active and passive safety technologies it calls Intelligent Drive.

A highlight is the optional $2,800 "Driver Assistance Package" (also offered on 2014 E-Class) that includes: Radar-based adaptive cruise control that also makes steering corrections. A front collision system that can stop the car from up to 31 mph without your input and slow it enough to partially mitigate a crash from up to 45 mph. A rear collision system that takes action to prepare the safety features if it sense a rearender coming. A system that senses cross-traffic with stereoscopic cameras and will hit the brakes. A lane keeping system that steers. A blind spot system that will brake.

Motivating all this down the road is a direct-injection, two-turbo, 4.7-liter V-8 putting out 455 horsepower and 516 lbs.-ft. of torque that hauls the big sedan from 0 to 60 mph in about 4.8 seconds, says M-B. Gas mileage is up, now 17 mpg city, 26 highway.

If you're feeling more sporting, the S63 AMG has a long list of chassis and other performance upgrades and a 5.5-liter two-turbo V-8 rated 577 hp. and 664 lbs.-ft.

M-B says more powertrains and body styles for the S-Class will be rolling out next year.

Goldman Resumes Coverage of Hanesbrands Inc. (HBI)

Goldman Sachs announced on Tuesday that it was resuming coverage of the North Carolina-based apparel company, Hanesbrands Inc. (HBI).

Taposh Bari, an analyst with the firm, commented about how Hanesbrands is the best performing stock in its universe, gaining a stellar 70% YTD compared to S&P 500′s gains of 20%. Bari cited a number of operational improvements that the company has undertaken, although he went onto to warn that, “HBI appears to have become a defensive stock, evidenced by its expanded multiple, as investors reward its macroindependent upward EPS revisions. If our observation is accurate, HBI’s multiple could be at risk if industry conditions improve.” As such, Goldman Sachs has the stock rated at “Neutral” with a price target of $66 a share.

Hanesbrands shares traded lower on Tuesday, shedding 0.74% on the day. The stock is up nearly 70% YTD.

South Dakota ranchers reeling from cattle losses

SIOUX FALLS, S.D. (AP) — Western South Dakota ranchers are reeling from the loss of tens of thousands of cattle in last weekend's blizzard, and many will dispose of carcasses in pits set to open Monday.

Rancher Heath Ferguson said the storm killed 96 percent of his herd of 100 black Angus and Limousin cattle, a hit worth about $250,000. He said total losses topped more than 1,000 head, as six other herds were roaming the family's 16,000 acres east of Sturgis.

Up to 4 feet of snow fell in the Black Hills area last weekend. Reports of 20 or more inches of snow were common, and 21½ inches in Rapid City were a record for both a 24-hour period in October and the entire month. At least two deaths were attributed to the storm, and it took a particularly heavy toll on livestock.

Ferguson said the vast majority of ranchers don't have insurance covering storm-related damage.

"It's cost-prohibitive for a producer," he said Sunday in an interview with The Associated Press. "Unless you're a really big operator, you can't afford to pay for the insurance."

Cattle ranchers dealing with weather-related losses would typically turn to the federal Livestock Indemnity Program, but that farm bill provision has expired and its future is in flux due to congressional gridlock and the continuing federal shutdown.

"We're an independent, pretty self-sufficient bunch, but we need help," Ferguson said.

South Dakota Gov. Dennis Daugaard and U.S. Sen. John Thune did an aerial assessment Thursday of the blizzard damage and livestock losses. State officials said at least 10,000 to 20,000 head of livestock died, but the estimate will likely rise.

The South Dakota Stockgrowers Association estimates that western South Dakota lost at least 5 percent of its cattle, much of which are raised for slaughter. Nearly a third of the state's 3.7 million cattle and calves reside in the western part of the state.

Ranchers who lost cattle will be able to dispose of the carcasses for free at severa! l pits being dug in Pennington County, according to the county's Emergency Operations Center. The county is coordinating the effort because the U.S. Farm Service Agency is closed during the shutdown.

Livestock owners are encouraged to document all animal losses with pictures, vaccination and hauling receipts in case disaster payments are available in the future.

South Dakota Farmers Union president Doug Sombke said that even if the federal government was open and Congress could reach a compromise on a new farm bill, it would take months to implement the Livestock Indemnity Program.

Meanwhile, the Stockgrowers Association, the South Dakota Cattlemen's Association and the South Dakota Sheep Growers Association are seeking donations to a relief fund that has been set up to help ranchers, and a couple of Montana groups are asking local farmers to donate cattle and sheep.

Ferguson, who also makes his living by working in the Wyoming coal fields, said he owns his herd, but many struggling ranchers have had to borrow money to stay in business.

"There's an awful lot of producers out here that sold our herds down because of the drought," he said. "A lot of people are into the financial institutions pretty hard."