We're Living Through the Best of Times [View article]
"My argument will be, when I am with them in Dallas in December at their conference, "Where are we going to get business-investment spending when banks aren't lending and capacity utilization is at an all-time low?""
It's called SAVINGS. We won't be seeing sizeable amounts of it for quite some time as the public needs to pay down their personal debt first, as the article notes.
Which leads to: "Lending to small business, the real engine of job creation, is sadly decreasing each month."
At what point in recent history did growth of small business become dependent on borrowing?
There are other options for growing your business, like using profits or selling a piece of the business to someone with savings. These are the businesses forming the backbone of the economy. Profitable and debt free. Any business which REQUIRES borrowing to operate is probably going to have a tough row to hoe for quite some time.
"The psyche of the American consumer has been permanently seared. Consumption and savings habits are being changed as I write."
Or stated another way, 'sanity returns'.
"I can't imagine these people will recklessly monetize US debt."
And thus, the author undermines his own basis of authority. Did you ever imagine that they would run a $1.42 Trillion annual Federal deficit at any time before 2007 with an estimated additional $7.6 Trillion in deficits to follow over the next decade? Probably not.
"even so, the world will be better, far better, in 20 years, with far more opportunities than today."
I'll bet Roman Emperor Arcadius thought along similar lines in 390 AD., a mere 20 years before the Visigoths sacked Rome in 410 AD. After that things were so 'good' that the next 1100 years (ie. the Middle Ages) are widely known for their improved standard of living compared to the Romans (NOT).
Read history. Whenever the ruling class abandons equality before the law and respect for individual rights in order to sustain their rule, you can bet that it won't be long before society's standard of living starts slumping.
The last decade has seen America's rule of law dismantled piece by piece. Until that fact is reversed, the decline will continue.
The Great Growth Debate (Part 2): The Benefits of Dividend Growth Stock Investing [View article]
Excellent articles Chuck (including Part I).
I nearly posted a comment to the first article but decided to hold off until I had read the second, and I was glad to see you discussed the matter I was going to post in the second article.
Specifically I am glad to see that you included the part that risk takes in making investment decisions. It is an often overlooked factor which can make or break any grand plan one might devise.
I have only recently come to 'see the light' regarding DG investing. For a great many years I have been doing my best at making growth stocks work and the majority of my investment funds are still in what I consider to be growth stocks while I mix in dividend growers.
That said, I believe it cannot be repeated often enough the major role that risk plays in long term success in the market.
Your articles show that a great growth or high-growth stock will easily outperform a dividend grower, but making that case is a lot easier in hindsight. For every success there are bound to be a few failures where growth stocks with good prospects implode and put a big dent in your account balance or just sit there and go nowhere for years on end. Relying on a 'buy low - sell high" approach requires that you make a second decision regarding when to sell.
The only way to dilute that risk is to limit the proportion of your account dedicated to one growth stock so that its risk of failure won't send you back to square one.
That risk is much lower for a good dividend growth stock as most have decades of stable operations behind them. An investor will probably be comfortable enough to put a large piece of their portfolio in a single DG stock knowing that the odds of complete failure are slim while the odds of continued success are good.
One could argue that the lower risk (or higher certainty of success) of dividend growth stocks may be one of the most significant reasons why the average investor is likely to attain their retirement goals using that approach instead of via a pure growth stock approach.
It would be interesting to see how relative performance of growth and dividend growth portfolios fare when one accounts for the necessary diversification in a growth portfolio and the fact that only a few growth stocks will actually prove to be of the moonshot variety while others will crash and burn.
Suppose we postulate two portfolios of 20 stocks for each approach and (for this exercise) prohibit active management.
The growth portfolio will likely wind up with one 25%/year moonshot, three 10%/year 'also-rans', six 5%/year growers, seven no-growers, and three "lost it all" clunkers.
In contrast the DG portfolio will be far more likely to contain 19 or 20 10%/year growers if dividends are reinvested.
Of course in the real world one would be monitoring and replacing laggard growth stocks, so such a comparison is only an approximation.
The DG portfolio will also require a lot less work to be successful over a 30 year span as the constant rotation between growth stocks is less necessary.
President Obama says House Speaker Boehner has decided to walk away from debt limit negotiations. Earlier today, Boehner had suggested talks would continue. [View news story]
"Would it not therefore be appropriate for a moderate raising of the debt ceiling to be agreed to by both sides, not as a solution to the fiscal and political issues in contention but rather to set the stage for the US electorate to decide those very fiscal and political issues? Would this not be both the honorable and practical way to proceed without prejudice to either side (and without painting the US and global economy into a corner of hell without a clear way out)?" - bob adamson
Bob,
That's what we've been doing for the past 30 years, and that's how we got into this mess in the first place. Eventually somebody's ox will be gored one way or the other.
a) Raise debt ceiling - gov't keeps borrowing us into the hole ad nauseum. You can't fix the problem of too much debt by borrowing ever larger amounts to keep up appearances. Eventually doing so will ruin the dollar in toto.
b) Make small cuts in spending, small tax increases, and raise the debt ceiling (aka - the middle road): This results in the same end state as a) but it might take longer and there will be fewer people with any savings left to try starting over.
c) Leave the debt ceiling and cut spending to the level of 90% of revenues, using the remaining 10% to pay down the debt. This is the only workable long term solution. Problem is, we have to cut nearly $2 Trillion in current spending to get to that point. Who gets the axe? A lot of folks, that's who. And many of them are unionized government workers.
We have already painted ourselves into a corner. We are now haggling over who gets cheated out of their future income and by how much.
The Cheapest Way to Long-Term Income and Capital Gains [View article]
"Veryan Allen identifies the world's best absolute return strategies and helps fiduciary investors achieve reliable portfolio performance. He has successfully managed most alpha capture styles and now researches new strategies, robust portfolio optimization and predictive analytics."
He could, however, use a short course on effective writing.
It may very well be that the author is the leading expert in his field, but I personally can't make heads or tails of what this article is trying to tell me. My take is that he says you should find a way to make 10% a year on your money, somehow, by shuffling it around to various hedge funds which are going to do well in the next year, but perhaps I misunderstood the semi-coherent ramblings presented.
How this article made it into the "Income" section of SeekingAlpha is beyond me. Was there a point the author was trying to make?
Did Bernanke Pull a Fast One Last Night? [View article]
"Do you think that the country can actually participate in the world economy without a Central Bank?" - DavidGCarpentier
Yes. Our country didn't have a central bank from 1837 to 1913. During that time period our country grew from a rural backwater to the wealthiest industrial power on the planet. Our money was freely convertible to gold on demand and inflations were limited as a result. The dollar's purchasing power fluctuated between $0.93 and $2.00 (reference $1 = 1800) during that entire period.
Since the central bank was formed in 1913, the purchasing power of the dollar has decreased from $1.70 to under $0.08. The last time our dollar's purchasing power was in the range established in 1800 - 1913 was in the 1940s. The dollar's purchasing power has dropped by over 90% since then.
During that time, the US went from being the world's largest creditor nation to the world's largest debtor nation. Our industrial base has been torn down and exported, and TBTF banks are gambling with 40:1 leverage knowing that the taxpayer will make good any losses they may have.
So in answer to your question. Yes. We can "participate in the world economy without a Central Bank". The last time we did, our economy created real wealth like no other time in history. Since the central bank was established that wealth has been squandered to the point where our country's total net worth is now negative (counting net present value of Federal obligations).
What took our ancestors 113 years of hard work to build has been destroyed in 70 years of debt fueled partying enabled by the central bank. We would all be better off in the long run if we got rid of it.
The Great Growth Debate (Part 2): The Benefits of Dividend Growth Stock Investing [View article]
I don't mind the negatives. Two and a half years ago I was a Top 10 commentator and discovered that there are people out there who are willing to go on a Thumbs-down spree just because you are able to point out deficiencies in their arguments.
Somebody spent several days giving me a thumb down on each and every one of the prior couple hundred comments I had written, knocking me out of the Top 10 for good. I don't view SA as a popularity contest. Those who are willing to read and consider will learn, others won't and that's their loss, which is sort of sad.
Thanks for the supportive comment also. I find that a great many people overlook the role risk plays in getting ahead in the market. I have many years of buying growth stocks and it's not an easy task to find one that makes you as rich as examples in an article would suggest. You have to be right twice, buying and selling, or you don't get anywhere. Finding the next Microsoft, Berkshire, or Wal-Mart when they first go public is nearly impossible for the average investor with limited time to spend looking.
That's the one are where DG stocks have a significant edge IMHO. There are only so many stocks that fit the mold and almost any of them will get you closer to a comfortable retirement if you buy them at a good price. The 'chancy' aspects of the exercise are greatly reduced.
Silver Backwardation: Will There Be a Silver Short Squeeze? [View article]
"The problem is, there are no silver shortages – only rumors of silver shortages. .... Additionally, over 340mm ounces of allocated silver is sitting at SLV." - dak riggins
That may be, but one of the implications of a backwardation in the futures market is that there is a lack of confidence that delivery on the futures contract will be met. Holders of the futures contract demanding delivery may be more likely to experience counter party risk and not actually get their product, at which point they are left holding the bag.
If the backwardation were completely meaningless then holders of silver could sell it on the spot market, buy it back via the nearest futures contract, take delivery in March, and keep the difference. After the silver is delivered in March, they would be ahead by whatever the backwardation amount is. Easy money, right?
The current difference between spot ($33.38) and March Silver ($32.90) is $0.48 / oz. SLV could theoretically generate a locked-in profit of 340mm * $0.48 = $163.2 Million in about a month. But they don't, not even with a small portion of their holdings.
The fact that backwardation exists tells you that people who have physical silver would rather forgo that locked-in profit than give up their silver. One of the reasons why is they have doubts about getting all their silver back in March.
President Obama says House Speaker Boehner has decided to walk away from debt limit negotiations. Earlier today, Boehner had suggested talks would continue. [View news story]
"I personally believe that if existing tax laws were rigidly enforced, and fraud, waste and abuse removed from government, that the budget could be balanced and the government would be able to perform whatever functions a majority of citizens feel it should be doing." - Tom Armistead
You've never worked with anyone in the government before, have you Tom?
I have, and you will never be able to remove the fraud, waste, and abuse in the system. That IS the system. The only way a bureaucrat can be certain to avoid trouble is to do as little as possible most of the time.
Did you know that government program managers receive poor ratings if they finish a contract under budget? It's true. They are punished for finishing the work and having money left over. Conversely, they are rewarded with promotions and raises if they can justify adding people to their staff for whatever reason. Even if they don't really need any more people to get the job done.
The rules currently in place encourage waste as a matter of routine.
Silver Backwardation: Will There Be a Silver Short Squeeze? [View article]
The presumptive contradictions in the author's final paragraph suggest that he "thinks too much" IMHO.
Throughout decades of trading a backwardation in the futures markets has been a sign of bullishness. Silver is currently in backwardation, ergo silver is bullish for now.
Initiating short positions before the backwardation turns contango is probably jumping the gun and asking for trouble.
The author may be correct in that silver could fall in the future (anything is possible), but if that's what I was thinking I'd probably want to wait until the backwardation ceased before taking a position. Until then I'd either stay on the sidelines or trade from the bullish side.
One has to wonder about the book's definition of "wealthy". If zip codes were used to select those with wealth, it wouldn't surprise me to discover that most living in those locations weren't really wealthy, but rather had large incomes (and likely correspondingly large obligations).
I have not read this book, but I have read one that is very similar and was based on interviews over a 20 year period with folks having a net worth over $1 Million:
The Millionaire Next Door by Thomas J. Stanley and William D. Danko (1998)
Whose analysis concluded that "results reveal fundamental qualities of this group that are diametrically opposed to today's earn-and-consume culture, including living below their means, allocating funds efficiently in ways that build wealth, ignoring conspicuous consumption, being proficient in targeting marketing opportunities, and choosing the "right" occupation."
I find it interesting that "Rich Like Them" makes no mention of savings levels or lifestyles, though the fact that 'rich' neighborhoods were the source of the study group might lead to some inferences on that point.
The book seems to concentrate on the "offensive" tactics of wealth generation, and ignore the "defensive" tactics of wealth preservation. This is probably equally as important to understand for the public, most of whom will have only limited opportunity to build a business empire. Almost anyone can build a better life for themselves via hard work, frugality, and savings provided they are intent on doing so.
My only holding on this list is HAS. They recently announced they would pay February 2013's dividend in December 2012 and they kept the dividend amount the same (a fiscal cliff driven decision, I presume).
The dividend made a nice 20% jump this past May and I look forward to seeing whether and/or how much it increases next May.
HAS has increased its dividend from $0.60 in 2007 (stock price around $20) to $1.74 in 2012 (stock price around $37). It's been performing quite well. CAGR of dividend is 23.7% and CAGR of price is 13.1% over that interval, for an annual total return north of 16%.
The DJIA during that interval increased from 12,050 to 13,150 for a CAGR in price of 1.75% and an annual total return of less than 5%.
Fortunately, selfless people like David Fish provide a means for us to "pick stocks" that manage to outperform 'the market' over time by putting together these Smackdowns.
In response, I'd like to award David Fish with the 'Great American Hero' award for investing, to be presented by none other than GI Joe himself. Be sure to keep a steady kung-fu grip on that mouse David! ;-)
President Obama says House Speaker Boehner has decided to walk away from debt limit negotiations. Earlier today, Boehner had suggested talks would continue. [View news story]
"Obama ostensibly is the President. If you will permit, he is like the Captain of the ship." - Good Captain
Yes. And Congress OWNS the ship. Read the Constitution.
The President doesn't just get to change the rules on a whim. Congress writes the laws, the President is supposed to approve and implement them as written. That's his job as head of the Executive branch.
When the ship owner tells the Captain to sail to Tahiti and bring back rum, he shouldn't sail to Ireland and get sheep dip because he thinks that's what's really needed. Not if he wants to stay on as Captain.
The Great Growth Debate (Part 2): The Benefits of Dividend Growth Stock Investing [View article]
Hmmmm. As anticipated. Another rash of -3s has swept a great many of my recent posts. The lurker either has more than a single account, or he's got sym-PATHETIC lurker-friends.
Lol. Maybe I can shoot for the "Bottom 10" commenter category.
Go Me! =-=-=-=-=-=-=-=-=-=-=-...
A poem: ----------- There once was a non-posting lurker, Others' posts he found to be irk-ers, He spreads his thumbs-down, All over SA-town, Like some angry, clicking berserker.
(There, I feel better now. All those who wish the thumbs down lurker would stop please give this post a thumbs-up.)
The Latest Crisis Now Unfolding On Wall Street [View article]
"Investor trust issues do not end with the banks. Unfortunately, they also extend to those that are supposedly enforcing the rules."
This bothers me more than the LIBOR deceptions. Why are there no criminal prosecutions for fraud?
LIBOR deception, Robo-signing foreclosures, Liar loans, Derivative grading of AAA for packaged MBS garbage, Front running via high speed trading, Etc.
Until the Too Big To Jail banks are criminally held to account for flouting the law, we can expect to see more of the same. A few billion in fines for stealing multi-billions by fraud won't stop the problems we are seeing until and unless the people responsible start going to jail for a long time. And that probably ought to include those who overlooked their regulatory duties and turned a blind eye to the acts of fraud as they happened.
To quote George Orwell: Some animals are more equal than others.
Common Sense Critical When Dealing With Retirement Withdrawals, Portfolio Allocation [View article]
"if reality diverges from the plan in a negative way, then something will have to give. If you've got $800,000 then the 4% rule allows for $32,000, if it drops to $700,000 then 4% calls for $28,000. Simple as that."
Exactly. Unless of course your portfolio consists of stocks paying a growing dividend at more than a 4% yield on cost.
Then, when your stocks are worth $800,000 you will get dividends of $32,000 (and sell nothing). If the share prices decline the following year, you will likely get more than $32,000 in dividends due to the dividend increases (and still sell nothing).
For those who claim generating yields over 4% is not likely, take a look at the Dividend For Life's (D4L) Pocket Change Portfolio here:
He started this portfolio in 2008 (my recollection anyway) and has been adding stocks regularly along the way. His portfolio currently pays him 4.12% of the amount he has invested. It is also showing him a capital gain of over 14.7% of his cost.
Anyone who can build a portfolio like D4L will be able to withdraw 4% of the total put into the portfolio by simply cashing dividend checks. Before retirement those dividend checks can be used to buy more dividend paying shares thereby boosting the yield on the original amount invested.
No shares selling necessary. It can be done. Just watch D4L's Pocket Change Portfolio as time goes on.
We're Living Through the Best of Times [View article]
It's called SAVINGS. We won't be seeing sizeable amounts of it for quite some time as the public needs to pay down their personal debt first, as the article notes.
Which leads to:
"Lending to small business, the real engine of job creation, is sadly decreasing each month."
At what point in recent history did growth of small business become dependent on borrowing?
There are other options for growing your business, like using profits or selling a piece of the business to someone with savings. These are the businesses forming the backbone of the economy. Profitable and debt free. Any business which REQUIRES borrowing to operate is probably going to have a tough row to hoe for quite some time.
"The psyche of the American consumer has been permanently seared. Consumption and savings habits are being changed as I write."
Or stated another way, 'sanity returns'.
"I can't imagine these people will recklessly monetize US debt."
And thus, the author undermines his own basis of authority. Did you ever imagine that they would run a $1.42 Trillion annual Federal deficit at any time before 2007 with an estimated additional $7.6 Trillion in deficits to follow over the next decade? Probably not.
"even so, the world will be better, far better, in 20 years, with far more opportunities than today."
I'll bet Roman Emperor Arcadius thought along similar lines in 390 AD., a mere 20 years before the Visigoths sacked Rome in 410 AD. After that things were so 'good' that the next 1100 years (ie. the Middle Ages) are widely known for their improved standard of living compared to the Romans (NOT).
Read history. Whenever the ruling class abandons equality before the law and respect for individual rights in order to sustain their rule, you can bet that it won't be long before society's standard of living starts slumping.
The last decade has seen America's rule of law dismantled piece by piece. Until that fact is reversed, the decline will continue.
The Great Growth Debate (Part 2): The Benefits of Dividend Growth Stock Investing [View article]
I nearly posted a comment to the first article but decided to hold off until I had read the second, and I was glad to see you discussed the matter I was going to post in the second article.
Specifically I am glad to see that you included the part that risk takes in making investment decisions. It is an often overlooked factor which can make or break any grand plan one might devise.
I have only recently come to 'see the light' regarding DG investing. For a great many years I have been doing my best at making growth stocks work and the majority of my investment funds are still in what I consider to be growth stocks while I mix in dividend growers.
That said, I believe it cannot be repeated often enough the major role that risk plays in long term success in the market.
Your articles show that a great growth or high-growth stock will easily outperform a dividend grower, but making that case is a lot easier in hindsight. For every success there are bound to be a few failures where growth stocks with good prospects implode and put a big dent in your account balance or just sit there and go nowhere for years on end. Relying on a 'buy low - sell high" approach requires that you make a second decision regarding when to sell.
The only way to dilute that risk is to limit the proportion of your account dedicated to one growth stock so that its risk of failure won't send you back to square one.
That risk is much lower for a good dividend growth stock as most have decades of stable operations behind them. An investor will probably be comfortable enough to put a large piece of their portfolio in a single DG stock knowing that the odds of complete failure are slim while the odds of continued success are good.
One could argue that the lower risk (or higher certainty of success) of dividend growth stocks may be one of the most significant reasons why the average investor is likely to attain their retirement goals using that approach instead of via a pure growth stock approach.
It would be interesting to see how relative performance of growth and dividend growth portfolios fare when one accounts for the necessary diversification in a growth portfolio and the fact that only a few growth stocks will actually prove to be of the moonshot variety while others will crash and burn.
Suppose we postulate two portfolios of 20 stocks for each approach and (for this exercise) prohibit active management.
The growth portfolio will likely wind up with one 25%/year moonshot, three 10%/year 'also-rans', six 5%/year growers, seven no-growers, and three "lost it all" clunkers.
In contrast the DG portfolio will be far more likely to contain 19 or 20 10%/year growers if dividends are reinvested.
Of course in the real world one would be monitoring and replacing laggard growth stocks, so such a comparison is only an approximation.
The DG portfolio will also require a lot less work to be successful over a 30 year span as the constant rotation between growth stocks is less necessary.
President Obama says House Speaker Boehner has decided to walk away from debt limit negotiations. Earlier today, Boehner had suggested talks would continue. [View news story]
Bob,
That's what we've been doing for the past 30 years, and that's how we got into this mess in the first place. Eventually somebody's ox will be gored one way or the other.
a) Raise debt ceiling - gov't keeps borrowing us into the hole ad nauseum. You can't fix the problem of too much debt by borrowing ever larger amounts to keep up appearances. Eventually doing so will ruin the dollar in toto.
b) Make small cuts in spending, small tax increases, and raise the debt ceiling (aka - the middle road): This results in the same end state as a) but it might take longer and there will be fewer people with any savings left to try starting over.
c) Leave the debt ceiling and cut spending to the level of 90% of revenues, using the remaining 10% to pay down the debt. This is the only workable long term solution. Problem is, we have to cut nearly $2 Trillion in current spending to get to that point. Who gets the axe? A lot of folks, that's who. And many of them are unionized government workers.
We have already painted ourselves into a corner. We are now haggling over who gets cheated out of their future income and by how much.
It's not pretty, but it's true.
The Cheapest Way to Long-Term Income and Capital Gains [View article]
He could, however, use a short course on effective writing.
It may very well be that the author is the leading expert in his field, but I personally can't make heads or tails of what this article is trying to tell me. My take is that he says you should find a way to make 10% a year on your money, somehow, by shuffling it around to various hedge funds which are going to do well in the next year, but perhaps I misunderstood the semi-coherent ramblings presented.
How this article made it into the "Income" section of SeekingAlpha is beyond me. Was there a point the author was trying to make?
If so, I missed it completely.
Did Bernanke Pull a Fast One Last Night? [View article]
Yes. Our country didn't have a central bank from 1837 to 1913. During that time period our country grew from a rural backwater to the wealthiest industrial power on the planet. Our money was freely convertible to gold on demand and inflations were limited as a result. The dollar's purchasing power fluctuated between $0.93 and $2.00 (reference $1 = 1800) during that entire period.
Since the central bank was formed in 1913, the purchasing power of the dollar has decreased from $1.70 to under $0.08. The last time our dollar's purchasing power was in the range established in 1800 - 1913 was in the 1940s. The dollar's purchasing power has dropped by over 90% since then.
During that time, the US went from being the world's largest creditor nation to the world's largest debtor nation. Our industrial base has been torn down and exported, and TBTF banks are gambling with 40:1 leverage knowing that the taxpayer will make good any losses they may have.
So in answer to your question. Yes. We can "participate in the world economy without a Central Bank". The last time we did, our economy created real wealth like no other time in history. Since the central bank was established that wealth has been squandered to the point where our country's total net worth is now negative (counting net present value of Federal obligations).
What took our ancestors 113 years of hard work to build has been destroyed in 70 years of debt fueled partying enabled by the central bank. We would all be better off in the long run if we got rid of it.
blog.mises.org/10553/t.../
The Great Growth Debate (Part 2): The Benefits of Dividend Growth Stock Investing [View article]
Somebody spent several days giving me a thumb down on each and every one of the prior couple hundred comments I had written, knocking me out of the Top 10 for good. I don't view SA as a popularity contest. Those who are willing to read and consider will learn, others won't and that's their loss, which is sort of sad.
Thanks for the supportive comment also. I find that a great many people overlook the role risk plays in getting ahead in the market. I have many years of buying growth stocks and it's not an easy task to find one that makes you as rich as examples in an article would suggest. You have to be right twice, buying and selling, or you don't get anywhere. Finding the next Microsoft, Berkshire, or Wal-Mart when they first go public is nearly impossible for the average investor with limited time to spend looking.
That's the one are where DG stocks have a significant edge IMHO. There are only so many stocks that fit the mold and almost any of them will get you closer to a comfortable retirement if you buy them at a good price. The 'chancy' aspects of the exercise are greatly reduced.
Silver Backwardation: Will There Be a Silver Short Squeeze? [View article]
That may be, but one of the implications of a backwardation in the futures market is that there is a lack of confidence that delivery on the futures contract will be met. Holders of the futures contract demanding delivery may be more likely to experience counter party risk and not actually get their product, at which point they are left holding the bag.
If the backwardation were completely meaningless then holders of silver could sell it on the spot market, buy it back via the nearest futures contract, take delivery in March, and keep the difference. After the silver is delivered in March, they would be ahead by whatever the backwardation amount is. Easy money, right?
The current difference between spot ($33.38) and March Silver ($32.90) is $0.48 / oz. SLV could theoretically generate a locked-in profit of 340mm * $0.48 = $163.2 Million in about a month. But they don't, not even with a small portion of their holdings.
The fact that backwardation exists tells you that people who have physical silver would rather forgo that locked-in profit than give up their silver. One of the reasons why is they have doubts about getting all their silver back in March.
President Obama says House Speaker Boehner has decided to walk away from debt limit negotiations. Earlier today, Boehner had suggested talks would continue. [View news story]
You've never worked with anyone in the government before, have you Tom?
I have, and you will never be able to remove the fraud, waste, and abuse in the system. That IS the system. The only way a bureaucrat can be certain to avoid trouble is to do as little as possible most of the time.
Did you know that government program managers receive poor ratings if they finish a contract under budget? It's true. They are punished for finishing the work and having money left over. Conversely, they are rewarded with promotions and raises if they can justify adding people to their staff for whatever reason. Even if they don't really need any more people to get the job done.
The rules currently in place encourage waste as a matter of routine.
Silver Backwardation: Will There Be a Silver Short Squeeze? [View article]
Throughout decades of trading a backwardation in the futures markets has been a sign of bullishness. Silver is currently in backwardation, ergo silver is bullish for now.
Initiating short positions before the backwardation turns contango is probably jumping the gun and asking for trouble.
The author may be correct in that silver could fall in the future (anything is possible), but if that's what I was thinking I'd probably want to wait until the backwardation ceased before taking a position. Until then I'd either stay on the sidelines or trade from the bullish side.
Rich Like Them [View article]
I have not read this book, but I have read one that is very similar and was based on interviews over a 20 year period with folks having a net worth over $1 Million:
The Millionaire Next Door by Thomas J. Stanley and William D. Danko (1998)
Whose analysis concluded that "results reveal fundamental qualities of this group that are diametrically opposed to today's earn-and-consume culture, including living below their means, allocating funds efficiently in ways that build wealth, ignoring conspicuous consumption, being proficient in targeting marketing opportunities, and choosing the "right" occupation."
I find it interesting that "Rich Like Them" makes no mention of savings levels or lifestyles, though the fact that 'rich' neighborhoods were the source of the study group might lead to some inferences on that point.
The book seems to concentrate on the "offensive" tactics of wealth generation, and ignore the "defensive" tactics of wealth preservation. This is probably equally as important to understand for the public, most of whom will have only limited opportunity to build a business empire. Almost anyone can build a better life for themselves via hard work, frugality, and savings provided they are intent on doing so.
Dividend Challengers Smackdown XXXIII [View article]
The dividend made a nice 20% jump this past May and I look forward to seeing whether and/or how much it increases next May.
HAS has increased its dividend from $0.60 in 2007 (stock price around $20) to $1.74 in 2012 (stock price around $37). It's been performing quite well. CAGR of dividend is 23.7% and CAGR of price is 13.1% over that interval, for an annual total return north of 16%.
The DJIA during that interval increased from 12,050 to 13,150 for a CAGR in price of 1.75% and an annual total return of less than 5%.
Fortunately, selfless people like David Fish provide a means for us to "pick stocks" that manage to outperform 'the market' over time by putting together these Smackdowns.
In response, I'd like to award David Fish with the 'Great American Hero' award for investing, to be presented by none other than GI Joe himself. Be sure to keep a steady kung-fu grip on that mouse David! ;-)
President Obama says House Speaker Boehner has decided to walk away from debt limit negotiations. Earlier today, Boehner had suggested talks would continue. [View news story]
Yes. And Congress OWNS the ship. Read the Constitution.
The President doesn't just get to change the rules on a whim. Congress writes the laws, the President is supposed to approve and implement them as written. That's his job as head of the Executive branch.
When the ship owner tells the Captain to sail to Tahiti and bring back rum, he shouldn't sail to Ireland and get sheep dip because he thinks that's what's really needed. Not if he wants to stay on as Captain.
The Great Growth Debate (Part 2): The Benefits of Dividend Growth Stock Investing [View article]
Lol. Maybe I can shoot for the "Bottom 10" commenter category.
Go Me!
=-=-=-=-=-=-=-=-=-=-=-...
A poem:
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There once was a non-posting lurker,
Others' posts he found to be irk-ers,
He spreads his thumbs-down,
All over SA-town,
Like some angry, clicking berserker.
(There, I feel better now. All those who wish the thumbs down lurker would stop please give this post a thumbs-up.)
The Latest Crisis Now Unfolding On Wall Street [View article]
This bothers me more than the LIBOR deceptions. Why are there no criminal prosecutions for fraud?
LIBOR deception,
Robo-signing foreclosures,
Liar loans,
Derivative grading of AAA for packaged MBS garbage,
Front running via high speed trading,
Etc.
Until the Too Big To Jail banks are criminally held to account for flouting the law, we can expect to see more of the same. A few billion in fines for stealing multi-billions by fraud won't stop the problems we are seeing until and unless the people responsible start going to jail for a long time. And that probably ought to include those who overlooked their regulatory duties and turned a blind eye to the acts of fraud as they happened.
To quote George Orwell: Some animals are more equal than others.
Common Sense Critical When Dealing With Retirement Withdrawals, Portfolio Allocation [View article]
Exactly. Unless of course your portfolio consists of stocks paying a growing dividend at more than a 4% yield on cost.
Then, when your stocks are worth $800,000 you will get dividends of $32,000 (and sell nothing). If the share prices decline the following year, you will likely get more than $32,000 in dividends due to the dividend increases (and still sell nothing).
For those who claim generating yields over 4% is not likely, take a look at the Dividend For Life's (D4L) Pocket Change Portfolio here:
www.dividend-growth-st...
He started this portfolio in 2008 (my recollection anyway) and has been adding stocks regularly along the way. His portfolio currently pays him 4.12% of the amount he has invested. It is also showing him a capital gain of over 14.7% of his cost.
Anyone who can build a portfolio like D4L will be able to withdraw 4% of the total put into the portfolio by simply cashing dividend checks. Before retirement those dividend checks can be used to buy more dividend paying shares thereby boosting the yield on the original amount invested.
No shares selling necessary. It can be done. Just watch D4L's Pocket Change Portfolio as time goes on.