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Buyandhold 2012

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  • The Plight Of Greek Pensioners? [View article]
    Leo, as a Greek American I am extremely disturbed by what has been happening in Greece during the past five years. I sometimes wonder if Greece should have remained on the drachma. Great Britain seems to be doing well by keeping the pound sterling.

    A study of history shows that countries that experience an extreme economic crisis are in danger of being taken over by dictatorships on the right or on the left. That would be a disaster for Greece which is the cradle of Western Civilization and of democracy.

    All four of my grandparents were born in Sparta, Greece in 1888. In spite of Sparta's reputation as being primarily warlike (those 300 Spartans did manage to hold off an army of one million Persians at Thermopylae), Sparta was one of the first places on earth to treat women with a certain degree of equality.

    You mentioned watching Greeks shouting at each other on television. I am used to that. Having grown up in a Greek family, I heard plenty of shouting, door slamming and unprintable curses in Greek. The more sedate Swedish foreign exchange student who stayed with us once seemed to be in a state of shock until he got used to all of the shouting, curses and door slamming.

    It would indeed be a Greek tragedy if the cradle of Western Civilization and democracy ended up falling victim to dictatorships on the right or on the left as a result of this ongoing economic crisis.
    Jul 4, 2015. 07:37 AM | 6 Likes Like |Link to Comment
  • Scanning The SA Family For Alpha: Rosenose [View article]

    I am glad that you decided to pass on Frontier. There are so many better options.

    As far as your list of questions, the only one that I feel strongly about is disclosure. I have never written an article for SA, but I have made over 3000 comments. The 36 stocks in my portfolio are clearly listed in my profile. Readers should know if an author or commenter has a position in any stock being discussed. That helps a reader to determine whether or not the author or commenter is completely unbiased.

    Changing your mind is a good thing, RS. I once read somewhere that intelligence is the ability to change.

    I concur with your high opinion of rosenose, RS. If you look back at her many comments you will see that she has never once resorted to ad hominem attacks or some of the other entertaining but not particularly useful antics that sometimes occur on SA. Rosenose is a class act just like Chuck Carnevale.

    Our goal should be to try to help each other find Alpha.
    Jul 3, 2015. 07:21 AM | 36 Likes Like |Link to Comment
  • Why I Am Replacing Colgate-Palmolive With Comcast. [View article]

    Comcast is a wonderful stock. If I went through every detail of the way I became a Comcast shareholder, this comment would put me and every reader to sleep. Suffice it to say that I bought shares of AT&T 40 years ago and from that investment Comcast was spun off from one of the other spinoffs.

    The only thing that I do not like about Comcast is that they charge me $88 a month for the privilege of being able to watch a lot of junk.

    But selling Colgate Palmolive? Colgate Palmolive has been one of the best performing Dividend Aristocrats over the long term. I remember reading somewhere that only a few Dividend Aristocrats have performed better than CL during the past 50 years.

    I frankly have trouble understanding the young investors of today, skipping from one stock to the next as if investing is a game of musical chairs.

    I personally would never sell CL and interfere with the wealth-building effect of long term compounding.

    Would I buy Comcast? Not as this time since the stock market is still hovering around an all time high.
    Jul 2, 2015. 03:45 PM | 3 Likes Like |Link to Comment
  • Seeking Alpha Contributors And Commenters Pick The Best Dividend Growers For The Next 5 Years [View article]
    "My grandma at 100 has been buying shares of Costco and Starbucks for the last 18 months."

    That comment made my day, ScottU. All I can say is: Go, granny, go!

    I am extremely sensitive to the issue of putting older investors out to pasture in the land of annuities, stocks with high yields, and investment grade bonds. A person retiring at 60 has the potential to live another 30 or 40 years. Why should that retired person sabotage his chances of increasing the value of his portfolio in a meaningful way by restricting his investments to those that offer mediocre long term returns? To me that is almost a form of age discrimination.

    The bottom line for me has always been: Either an investment is a good investment or it isn't. If it's a good investment, it should be good for a person of any age from 1 to 101.

    My mother is almost as old as your grandmother, ScottU. If anyone ever told my mother that she was too old for a particular investment, he better be able to duck fast enough to avoid her mean left hook.
    Jul 2, 2015. 02:18 PM | 20 Likes Like |Link to Comment
  • My Bet On Seeking Alpha's Future [View article]

    I have been reading and making comments on SA for three years. I am probably one of the least likely men on the planet to participate in any type of group on the Internet. I have avoided Facebook and Twitter and every other site on the Internet with the exception of Motley Fool and Yahoo Finance.

    What I like about SA is that it presents many different points of view. The comments appearing after the articles are sometimes more interesting and insightful than the articles themselves.

    And frankly SA has helped many investors to improve their investment skills. Reading SA is like a good workout in the investment gym.

    I wish you the best of luck in any of your future endeavors, David.
    Jul 2, 2015. 11:41 AM | 15 Likes Like |Link to Comment
  • The Most Secure DGI Stock [View article]

    Avoiding buying stocks when the S&P 500 is within 20% of an all time high is probably my most controversial investment strategy. That advice actually was given to me by my mother who is a better and more disciplined stock market investor than I am. She has made fewer investment mistakes than I have over the long term.

    It only makes sense to avoid buying stocks when the S&P 500 is within 20% of an all time high if your goal is to outperform the S&P 500 over the long term. I would classify myself as an extremely conservative but at the same time an extremely aggressive long term stock market investor. Conservative stocks if bought at the right time(whenever they are relatively cheap) and then never sold tend to make the most money for the investor over the long term.

    Would I recommend that young investors wait for a 20% correction in the S&P 500 from its all time high before buying any stocks? That 20% figure is not set in stone. It depends on how aggressive the young investor is. Young investors who wait for that 20% correction will probably make more money over the long term. Some young investors might not have the patience to wait for a 20% correction in the S&P 500. To those young investors who are unwilling to wait for a correction of that magnitude, I would strongly suggest focusing on stocks that are attractively priced at the moment such as Exxon Mobil, Chevron, and Conoco Phillips.
    Jul 2, 2015. 11:04 AM | 4 Likes Like |Link to Comment
  • Newly Political DOJ Sues To Block General Electric's M&A [View article]

    GE bashers can find many things not to like about GE.

    1) Ge slashed its dividend during the financial crisis.
    2) The price of GE fell to 7 during the financial crisis.
    3) The performance of GE since the year 2000 has not been good.
    4) The Alstom deal may be delayed.
    5) DOJ is suing GE over the Electrolux deal.

    But there is also a lot to like about GE.

    1) GE has outperformed the S&P 500 over the past 35 years.
    2) Every time that the price of GE stock fell significantly, it was an excellent buying opportunity.
    3) I once read that GE was the number 1 stock owned by members of Congress and the Senate.
    4) There is the future potential for GE to spin off some of its businesses to shareholders.
    5) GE has performed well since the financial crisis.

    On balance, I view GE as a good long term investment. I have been a GE shareholder for decades. I am never selling any shares of GE.
    Jul 2, 2015. 09:22 AM | 4 Likes Like |Link to Comment
  • The Most Secure DGI Stock [View article]

    I hate to criticize a fellow Greek since I am the world's number 3 Hellenophile after Melina Mercouri and my mother. I still get emotional when I see photographs of Melina Mercouri kissing the ground after she returned to Greece after being kicked out by the military junta.

    I don't think JNJ is particularly overpriced at this time. The PE ratio is only 17 which is not bad for a stock of that quality. I can't think of a better stock than JNJ.

    Would I personally buy shares of JNJ today? No. I make an effort to follow at least 4 rules.

    1) Never buy a stock with a PE ratio higher than 20.
    2) Avoid buying stocks when the S&P 500 is within 20% of an all time high.
    3) Never sell unless you are forced to sell by a cash buyout.
    4) Buy high quality dividend growth stocks and other stocks that tend to perform well over the long term.

    It is true that most investors do not outperform the S&P 500 over the long term. The reason for that is that most investors have no clue how to invest in the stock market. This is due to the fact that investment basics are poorly taught in American schools. Any investor with a little bit of common sense and a knowledge of investment basics should be able to outperform the S&P 500 over the long term.
    Jul 2, 2015. 06:45 AM | 2 Likes Like |Link to Comment
  • Seeking Alpha Contributors And Commenters Pick The Best Dividend Growers For The Next 5 Years [View article]
    "When considering a new position, what metrics do you examine to help ensure strong accelerating dividend growth for the next five years?"

    I check out the dividend growth rate for the past 10 years. Below are 5 stocks with good dividend growth rates.

    W. W. Grainger
    UnitedHealth Group

    I have noticed that stocks with dividend yields in the range of 2% to 4% generally have better dividend growth rates than stocks with dividend yields in the range of 4% to 6%. In addition, the stocks with the lower dividend yields tend to have better capital appreciation over the long term.

    There are 36 stocks in my portfolio. My average dividend yield is approximately 2.5%.

    Chasing yield is a mistake in the stock market since it can lead to poor performance over the long term. In fact, chasing just about anything in the stock market is a mistake.

    A stock's long term dividend growth rate is something to seriously consider before investing in the stock.
    Jul 1, 2015. 10:28 PM | 13 Likes Like |Link to Comment
  • The Most Secure DGI Stock [View article]

    Talk about bait and switch! The title of this article is "The Most Secure DGI Stock" and then you recommend SPY.

    SPY is fine for investors who do not have the investment skill or the time necessary to successfully manage their own common stock portfolios.

    I have managed my own common stock portfolio for 45 years. I am a hardcore buy and hold dividend growth stock investor. My common stock portfolio has outperformed the S&P 500 over a 45 year period of time.

    Successful investing in the stock market is not rocket science, Aristofanis, nor is it time consuming.

    All an investor has to do if he wishes to be a successful stock market investor is to buy shares of high quality dividend growth stocks and other stocks that tend to perform well over the long term. He should buy these stocks whenever they are relatively cheap (during major stock market corrections) and then never sell them.

    Not rocket science and not time consuming.
    Jul 1, 2015. 06:42 PM | 5 Likes Like |Link to Comment
  • The Best Way To Judge Past Performance: Part 2 [View article]
    The best way to judge past performance?

    There are many ways to judge past performance, short term, medium term and long term.

    The way I judge my past performance is quite simple.

    1) What is the total amount of money that I have invested in the stock market during the past 45 years?

    2) What is the total value of my common stock portfolio today?

    3) How much money have I received in dividends during the past 45 years?

    4) How much money have I received in cash buyouts during the past 45 years?

    I add up lines 2, 3 and 4 and subtract line 1. Once I have that figure, I compare my long term performance to the performance of the S&P 500. If I have outperformed the S&P 500 over the long term, I am satisfied.

    A common mistake that is made when judging an investor's past performance in the stock market is to base that judgement on too short a period of time. Successful investing in the stock market is not a sprint, it is a marathon.
    Jul 1, 2015. 04:53 PM | 15 Likes Like |Link to Comment
  • Justifying My Position In Johnson & Johnson [View article]

    No one has any reason to justify his position in Johnson & Johnson. I can't think of a better stock than JNJ.

    On the other hand, if you had bought Under Armour with its absurdly high PE ratio of 91, I would be saying: Joseph, you have a lot of explaining to do.
    Jul 1, 2015. 11:21 AM | 12 Likes Like |Link to Comment
  • Are Dividend Growth Investors Livin' Too Large? [View article]

    This so-called Great Wall of China between Dividend Growth Investing and Total Return Investing is an illusion. They are actually the same thing.

    Over the long term, the Dividend Aristocrats, stock that have increased their dividends every single year for at least the last 25 years, have outperformed the S&P 500 by an average of 2.5%. By anyone's standards, that is an extremely impressive total return.

    Investors often make the mistake of chasing high flying momentum stocks. These stocks have a tendency to eventually crash and burn. It is the classic story of the tortoise and the hare. The hare gives the appearance that he is really moving along. But it is the tortoise who plods along slowly but keeps on moving who wins the race in the end.

    Young people should not be distracted by momentum stocks, ridiculously overpriced high flyers that have a tendency to crash and burn. Instead they should load up on high quality dividend paying stocks whenever these stocks are relatively cheap and then never sell them, allowing the miracle of long term compounding to turn a modest investment into a substantial portfolio over the long term.

    "Widows and orphans" stocks" are the way to go, Adam. It is a bit of an irony that the "widows and orphans" stocks outperform the high flying momentum stocks over the long term. But whoever thought that that slowpoke tortoise would run circles around that fast moving hare?
    Jun 30, 2015. 03:38 PM | 18 Likes Like |Link to Comment
  • Why I Bought Greek Stocks Today [View article]
    Why I bought Greek stocks today?

    Jeremy, I have always been a contrarian investor. I like to buy stocks when other investors are fleeing toward the exits and stocks are really cheap.

    But buying Greek stocks today?

    Talk about grabbing hold of a falling knife.

    I will not be buying Greek stocks today. It seems to me that there are better long term investment alternatives.
    Jun 30, 2015. 08:18 AM | 3 Likes Like |Link to Comment
  • Greek Crisis Is An Unsightly Reminder Of Gold's Benefits [View article]
    Orange Peel,

    For the ridiculously high price of approximately $88 a month, I have expanded basic cable. That gives me the opportunity to watch countless infomercials.

    The infomercial that really stands out in my mind is rather sleazy. It features a woman with a British accent calmly caressing her gold coins, a big smile of smug satisfaction on her face, serene in the knowledge that all is well in the world now that she can calmly caress her gold coins every time she experiences a tinge of economic anxiety.

    The truth of the matter is that gold has not been a good investment over the long term.

    Back in 1975 one of my aunts died and left me a box filled with old gold coins. My mother, who is a better investor than I am and more pragmatic, advised me to sell the gold coins and invest the money in the stock market. I should have listened to her. The stock market was really low in 1975.

    Instead I placed the box filled with gold coins in a safe deposit box at the bank. That box filled with old gold coins is still sitting in my safe deposit box 40 years later. For 40 years those gold coins have not sent me even one dividend check, not even 1% in interest.

    Gold is not a good investment compared to the other options. Mom was right. I should have sold those gold coins 40 years ago and invested that money in the stock market.
    Jun 30, 2015. 08:03 AM | 5 Likes Like |Link to Comment