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Eric Parnell, CFA  

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  • Bond Rout: Time To Run Or Time To Buy? [View article]
    Hello Robert,

    Thanks for your comment and for raising a very good question, for in retrospect I was a bit vague on this point. My reasoning for stating that policy makers are still battling a deflation problem is that core inflation readings remain stubbornly stuck below their target readings despite the fact that trillions of dollars, euros, yen and other currencies have been continuously injected into the financial system for more than six years now. This ongoing challenge suggests that deflation remains the primary problem facing policy makers and not inflation. Thanks for the question and for providing me with the opportunity to clarify this point.

    I also wanted to mention that I have enjoyed reading your fine articles on SA. And in relation to my article here, one that I thought was particularly good and serves as an important counterpoint and must read in my view was your article from April 19 entitled The Return To The Inflation Trade. In your article you do an excellent job of outlining the types of scenarios that could quickly turn any current deflationary pressures into an inflationary rush. It is an excellent article and I've included a link here for readers that are interested in taking a look.

    http://seekingalpha.co...

    Thanks again Robert. I look forward to reading your future articles on SA and continuing to collaborate on thoughts and ideas.
    May 12, 2015. 10:33 PM | 3 Likes Like |Link to Comment
  • Bond Rout: Time To Run Or Time To Buy? [View article]
    Hello Larry3993,

    Thanks for your comment and you're absolutely right, for while it has been a big move from a yield perspective, on a percentage total return basis the impact has been measurable but still fairly modest. And nothing like we've seen take place in stocks from time to time over the years.

    Great point and thanks again.
    May 12, 2015. 10:25 PM | Likes Like |Link to Comment
  • Bond Rout: Time To Run Or Time To Buy? [View article]
    Hello usiah,

    Thanks for the excellent comment, as you highlight the perspective that is so important for bond investors and one of the distinct advantages of owning individual bonds over an ETF. To your point, bond prices will fluctuate along the way, but with the intent of holding them until maturity, such price fluctuations simply do not matter (barring a looming default or other such issue). The coupon stream just keeps coming in and by diversifying the time to maturity the opportunity exists to your point to reinvest at higher yields following a sell off like we've had recently.

    Outstanding point and thanks again for sharing it.
    May 12, 2015. 10:24 PM | 1 Like Like |Link to Comment
  • Bond Rout: Time To Run Or Time To Buy? [View article]
    Hello Glenn,

    Thanks for your great comment and for sharing your thoughts and perspectives. And you make a particularly good point about the business cycle, as unfortunately policy makers have tried to defeat the business cycle over the last few decades to give us all of the good and none of the bad. Unfortunately, this lack of balance in allowing the economy to periodically cleanse itself of its excesses only leads to far greater problems down the road.

    Great points and thanks again.
    May 12, 2015. 10:21 PM | 7 Likes Like |Link to Comment
  • The Excitement Of Playing It Safe [View article]
    Hello WDL,

    Thanks for your comment and great points, particularly on cash. You have actually anticipated an upcoming article that I have in the planning queue!

    Thanks again!
    May 11, 2015. 11:19 PM | Likes Like |Link to Comment
  • The Excitement Of Playing It Safe [View article]
    Hello awayk,

    Thanks for your comment and for raising some excellent points. I regret if my previous DGI article came across as an admonishment, as this was not my intent. Instead, it was designed to raise awareness among investors that are new to the DGI space that the market environment will not always be as it is today and that it may be much tougher to stick to the DGI discipline if and when we enter a new bear market phase. By presenting the stress test, it was my hope that it would at least be on the radar screen for some that might otherwise be basking in the warm glow radiating from the likes of some of the business news stations on a daily basis. But my raising awareness does not at all mean that I am not still actively participating in the space myself. This is the purpose behind this follow up article, which is to say that despite the broader downside risks, investors still have the opportunity to own stocks that can perform well through emphasizing stocks that meet selected criteria.

    And I also agree that I would not necessarily be a buyer of CLX or MKC at the present time. My purpose in showing CLX and MKC here was not to recommend purchasing them, but to instead show that steady companies involved in businesses that many may deem largely unexciting have the ability to provide outsized returns in up markets while also protecting against downside in down markets to generate an overall positive returns experience. But both are currently richly valued today in my view. Instead, investors are well served to consider what companies might be similar in fitting the bill at more attractive valuations for any next future bear market on the horizon.

    Great points and thanks again.
    May 11, 2015. 10:59 PM | 2 Likes Like |Link to Comment
  • The Excitement Of Playing It Safe [View article]
    Hello grisly_atoms,

    Thanks for your comment and great question. Although I do not own Clorox today and have not in recent years (it has run away from me a few times including most recently last summer), I owned the company for most of last decade and was a holder at the time in 2005. Basically, the company cut profit forecasts measurably that year due to increased competition from the likes of PG and KMB along with higher energy prices and slow movement on price increases to pass along these costs. But to your point, they quickly found their footing and bounced back in 2006.

    Thanks again
    May 11, 2015. 10:51 PM | Likes Like |Link to Comment
  • The Excitement Of Playing It Safe [View article]
    Hello Alan,

    Thanks for your comment and great points as always. And I agree with your points about the need for a menu transformation at McDonald's, particularly their need to simplify and get more all natural items on the menu among other things. The restructuring opportunity is there and I will be interested to see how Easterbrook performs in the coming months.

    Thanks again Alan. Hope you are doing well.
    May 11, 2015. 10:44 PM | Likes Like |Link to Comment
  • The Excitement Of Playing It Safe [View article]
    Hello Abdul,

    Thanks for your comment and for your excellent points.

    To clarify for all readers, my inclusion of CLX and MKC in the above article should not be interpreted as a recommendation to purchase these companies at current prices. Instead, they are designed to show that stocks have performed well during past bear market episodes, which suggests that stocks with similar characteristics have the potential to perform well once again during the next bear market.

    And I agree that now is not necessarily the time to be initiating positions in either CLX or MKC for the valuation reasons that you have mentioned (while I have held MKC for some time and will likely continue to hold it, I would not recommend initiating new positions at current prices).

    Great point and thanks for raising it to provide me with the opportunity to clarify.
    May 11, 2015. 10:42 PM | 1 Like Like |Link to Comment
  • The Excitement Of Playing It Safe [View article]
    Hello Conrado,

    Thanks for your comment. Great point. In the interest of full disclosure, I have been long GIS for a while (this is not a recommendation to buy GIS today, as it has been priced at a premium for some time now) and you are exactly right that it has also performed well in a similar way to CLX and MKC.

    Great point and thanks again!
    May 11, 2015. 10:38 PM | 1 Like Like |Link to Comment
  • Investing On A Low Rate Environment: How To Approach It? [View article]
    Thanks for the kind words! I appreciate it!
    May 11, 2015. 01:53 PM | 1 Like Like |Link to Comment
  • Stress Test For Dividend Growth Investors [View article]
    Thanks to all for the continuing great comments. I have enjoyed reading everyone's thoughts and perspectives.

    I wanted to share an article that was published today that builds on the discussions that are taking place here. Thanks to Conrado Foglio Bonda for his latest article.

    http://seekingalpha.co...

    Thanks again!
    May 11, 2015. 01:50 PM | 1 Like Like |Link to Comment
  • Investing On A Low Rate Environment: How To Approach It? [View article]
    Hello Conrado Foglio Bonda,

    Thanks for your great article. And I appreciate your mentioning my recent article in yours. Looking forward to reading your future posts on SA!

    Thanks again!
    May 11, 2015. 01:48 PM | 1 Like Like |Link to Comment
  • Stress Test For Dividend Growth Investors [View article]
    Hello everyone,

    I wanted to provide a brief introductory comment to say thank you to everyone that has shared their thoughts and perspectives on my article that was posted today. I have read every comment from peace4 above from late this morning to scoots just before midnight tonight.

    As I have always said, the best material on SA comes not from the articles but from the comments that accompany the article, and this is absolutely true in the case of this article. I thoroughly enjoyed reading everyone's thoughts and insights as well as the challenges to the content of my article.

    A lot of experience has been shared in the comment section so far that is essential reading in my view. For as many of you highlighted, the importance of being prepared and taking the time to differentiate the truly high quality DGIs from those that are at risk of coming apart is critical in not only surviving but thriving during periods of prolonged market weakness.

    Thanks again to everyone who has commented. I appreciate your insights.
    May 11, 2015. 12:11 AM | 3 Likes Like |Link to Comment
  • Graying Bull [View article]
    Hello Alan,

    Thanks as always for your comment. You make a number of brilliant points here. I always enjoy reading your thoughts and perspectives. I hope you are doing well and had a nice weekend and I look forward to talking with you again soon.
    May 10, 2015. 11:59 PM | Likes Like |Link to Comment
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