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Joseph P. Porter
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I am a retired college faculty in Philosophy, with specializations in Ethics, Socio-political Theory and Rational Choice/Decision Theory. My teaching focus was on Business Ethics, Medical Ethics and Logic. After retirement I freelanced as a Grant Writer/Fund Raising Consultant. I have taught at... More
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  • Dogging It: Week 41 – The Shut Down Is Over … Not 9 comments
    Oct 13, 2013 3:02 PM

    Buoyed up by the expectation that people in Washington were finally working things out, indexes enjoyed two days of upwards mobility. Over the weekend, however, things have sort of cooled off in D.C., so I'd expect the market to be pretty volatile Monday, with investors looking for any excuse to send the market spiraling downwards. Any good news would probably be viewed with skepticism, I should think, until the ink is dried on whatever bill ends up getting passed.

    The Dow:

    (click to enlarge)

    Nothing much happening here. Any changes were minor, as reflected in gains of 61 bps for the PICs and 23 bps for Dogs. All that really happened is that the large losses early in the week were negated by gains on Thursday and Friday.

    The S&P 500

    (click to enlarge)

    The PICs were mostly up, and the portfolio as a whole was up 82 bps; not much, but anything up is good. The Dogs, on the other hand had something of a phenomenal week, with solid gains by just about all companies, and significant gains by a few: CenturyLink (NYSE:CTL) up 480 bps; Excelon (NYSE:EXC) up 331 bps; Frontier Communications (NASDAQ:FTR) up 301 bps (these three companies have had their trials and tribulations of late); Pitney Bowes (NYSE:PBI) and R.R. Donnelley (NASDAQ:RRD) keep on track to become two-baggers, with Donnelley up an impressive 378 bps. The big winner of the week is Windstream Holdings (NASDAQ:WIN), with a gain of 580 bps.

    Let's see if they can keep it up this week.

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Comments (9)
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  • Miz Magic DiviDogs
    , contributor
    Comments (4312) | Send Message
     
    I suspect you're right. Since I don't have any ready cash to use if the market does take a dive, I would much prefer to just close my eyes and sleep through the next week until all the nonsense is over. :)

     

    Miz
    13 Oct 2013, 04:13 PM Reply Like
  • Joseph P. Porter
    , contributor
    Comments (691) | Send Message
     
    Author’s reply » Actually, anticipating significant difficulties for Washington in the coming week(s), I sold off most of my holdings two weeks ago. I don't have that much in the market that I can afford substantial losses, and I'm afraid I see losses ahead. So I have only the holdings that both: are subject to unpredictable gains off set by gradual drops, and that are at a point where they seem ready to pop.

     

    So approx 90% of my money is in cash, right now. Might seem a bit drastic, but I don't intend to lose any more money to the shut down.

     

    Even if the Senate were to come up with a plan, it would have to pass the House, and I don't know that Rep. Boehner can all of a sudden call the shots there - he's pandered to the far right for so long that any attempt to move to the center is going to cost him a lot of Republicant support.

     

    Neither house of congress opens until tomorrow PM, and no votes are likely until after 6. Our hard(ly)-working politicians need their beauty rests after a weekend of golf, drinking and whatever illicit activities in which they indulge themselves.

     

    There has not yet been any concrete signal from the Senate, so it is likely that no resolution would come out of there before late tomorrow. Supposing that, it would be late Tuesday before the House would vote on it. If a bipartisan plan comes out of the Senate, the Senate as a whole would accept it, so it goes to POTUS, who signs on Wednesday. That's cutting it close.

     

    Indications are that the market is going to be down tomorrow, as market futures are down in Asia.

     

    I'll make up what losses I've had once things get back to "normal."

     

    Joe
    13 Oct 2013, 10:47 PM Reply Like
  • Miz Magic DiviDogs
    , contributor
    Comments (4312) | Send Message
     
    I think you're probably right. I can't disagree with a thing you've said. However, I'm still invested at the moment, most of my stocks have already declared their dividends for next quarter and several of them are paying for the mortgage on my old house that hasn't sold yet (in escrow). Paying for 2 houses is a bit pricey!

     

    Miz
    13 Oct 2013, 11:35 PM Reply Like
  • Joseph P. Porter
    , contributor
    Comments (691) | Send Message
     
    Author’s reply » Two houses! Ouch. No wonder you focus on dividends. When we started getting close to shut down and losses started to pile up I researched "quick" ways to get payoffs - they do exist, but require daily focus on the market. They don't offer much in the way of dividends, but the capital growth potential will be substantial once things clear up in Washington for a while.

     

    Ultimately, I think the shut down came at the right time for me. I was wanting to restructure my investments, but could always find reasons why this company or that company was still worth holding and waiting for a turn-around. Now I'm clear of all that, and the restructuring will be easy and - hopefully - a bit more secure.

     

    How long has your house been on the market, if I may ask?

     

    joe
    14 Oct 2013, 11:33 AM Reply Like
  • Miz Magic DiviDogs
    , contributor
    Comments (4312) | Send Message
     
    Less than a month and it's in escrow, but it took several months to get it on the market after I'd already moved into the new house (long story & long distance). Been paying 2 mortgages since June, and combined with all the expenses of a new house, the only reason I could afford to move was because I have just enough in dividends coming in to cover the expenses.

     

    I did sell some stocks to pay for the new flooring in the new house, but other than that, just lots of double-digit yield dividends. I took a huge swallow and sold everything but the high-yielders, so I'm crossing my fingers while riding the high-yield dragon at the moment. I plan to get back into less volatile stocks just as soon as the other house is sold. Hopefully without losing my *ahem*! :)

     

    Miz
    14 Oct 2013, 03:07 PM Reply Like
  • Joseph P. Porter
    , contributor
    Comments (691) | Send Message
     
    Author’s reply » I tried riding the "high-yield dragon" for a while, and found that the yield was coming at the expense of my capital. As long as the capital stayed above my cost basis I was happy, but last quarter my capital went below basis, and like I said, I don't have that much invested that I could afford losses. With the uncertainties of shut down and default, I just pulled everything out (but for just under 15%).

     

    When it's safe again, I'll take the plunge, but maybe look for growth stocks or ETFs.

     

    I hope your house sells soon - the housing market seems to be waking up, but looks to be doing it in fits and starts.
    14 Oct 2013, 05:01 PM Reply Like
  • Miz Magic DiviDogs
    , contributor
    Comments (4312) | Send Message
     
    I'm lucky that I have a pension & SS to pay my normal expenses, so the investments (in IRAs) are non-essential money. I don't have a huge portfolio, but I've built up enough that I've managed to pull out quite a bit and still am above water even when it's down some.

     

    I'm waiting on the buyer's appraisal to come in, hopefully it will be very close to their offer. You just never know with this housing market anymore!

     

    M.
    14 Oct 2013, 05:18 PM Reply Like
  • Joseph P. Porter
    , contributor
    Comments (691) | Send Message
     
    Author’s reply » With financing the way it is, the appraisal ends up being the biggest worry of the whole process.

     

    Good luck!

     

    J.
    14 Oct 2013, 05:25 PM Reply Like
  • Miz Magic DiviDogs
    , contributor
    Comments (4312) | Send Message
     
    Thanks! :)

     

    M.
    14 Oct 2013, 05:26 PM Reply Like
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