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Emerald

Emerald
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  • Should You Buy Realty Income At Current Prices? [View article]
    fniemaan & berloe: I have no problem with SA authors who also have newsletters. I don't always agree with Brad Thomas, but he writes decent articles and provides valuable comments. (David Van Knapp is a great contributor and also sels an e-book.) No need to take cheap shots unless you believe the writer is insulting the rest of us. Regards
    Nov 27 12:44 PM | 27 Likes Like |Link to Comment
  • The End of the U.S. As We Know It: Tracking the Dollar Downward [View article]
    Wow! What nonsense sprinkled in with a hanful of reasonable assessments. First, Peter Shiff has been wrong so many times that you would be destitute folowing his advice. Second, you assume that printing or borrowing money will automatically cause asset prices to rise above previous levels. I would suggest that the sheer volume of asset destruction (financial instruments,housing prices, etc.) far exceeds the "inflationary" impact of an increasing money supply. Falling realestateprices are deflationary. That is why we are in a deflationary period for another 12-18 months. Perhaps inflation will appear in the future but it is not a risk in 2009-2010. The value of long Treasuries will decline as interest rates increase. Gold is in a long term uptrend but will have significant quarterly corrections.
    Feb 1 03:13 PM | 26 Likes Like |Link to Comment
  • The Worst Case Scenario (Someone Has to Say It) [View article]
    And the big boys on Wall Street will reach out and crush your third world currency and destroy you again. Wher are you going to go that has a semblance of democracy (even imperfect) and a stable currency? Latin America has a lower cost of living, occasional depressions and people who have money put it in US banks in Miami. I guess Costa Rica is your only choice but, again, what currency do you prefer?


    On May 03 10:14 AM Pcatlow wrote:

    > The piece is an interesting and compelling read. I lean more towards
    > the author's view than against.....but, the time-line will be stretched
    > out further.
    >
    > The fact that I, as a Futures trader, am completely out of this market
    > is my lead card in this play. Now, beyond that, my wife and I (childless,
    > retired in a mountain top community, zero debt, and cash heavy) are
    > in the final stages of a major move away from the USA:
    >
    > 1. We will sell our house for whatever it will fetch.
    > 2. We are moving to Latin America.
    > 3. I will trade into foreign currencies as quickly as I can and at
    > the most ripe moment.
    > 4. We will break all ties to the US tax system, since Tax rates on
    > the "rich" (traders, income producers, and titans of industry - -
    > those who make more than a dollar a day (HA!), will see their tax
    > rates beat what we already see in the EU.
    > 5. We will find our health care somewhere else as this will never
    > be solved and the AMA has a complete strong-hold over the industry.
    > Even the last word of my last sentence tells us something (profits
    > from health is counter productive and leads to what we have now:
    > huge insurance premiums, deductibles and we are scared doo-doo-less
    > that a single health crisis will wipe us out---we are in our 50's
    > and the BIG C could kills us in more than one way).
    > 6. We will continue to believe not one word of the Wall Street spew
    > we read every day.....and not one word of the 10Q's and Quarterly
    > reports which contain lies, and misleading data...
    >
    > I could go on and on, but folks the good OLE USA is doomed.
    May 3 11:22 AM | 23 Likes Like |Link to Comment
  • Dividend Investors Should Get Ready To Load Up [View article]
    WmHilger1, buy a copy of Turbotax and the program will do all the calculations for you. (If you hate socialist programs, you could always forgo collecting Social Security and Medicare or as some others call, them, "earned benefits".) It's best to keep politics and emotions out of investing. Taxes affect me as well, but making a profit comes first. Happy New Year! Long: T, VZ, BCE, WIN, VOD, CHL, CHT
    Dec 31 11:33 AM | 21 Likes Like |Link to Comment
  • Are Dividend Stocks A Substitute For Bonds? [View article]
    How would you know who is more educated or "anti-intellectual"? I am one of those DG investors, but hardly a zealot and always looking for decent research and financial analysis. I have worked in the financial industry as an corporate analyst, private equity investor and a commercial real estate investor and strategic planner at a Fortune 500 firm. I have two Master's degrees including an MBA in Finance from a top brand name institution (no school name dropping here!)

    With all that said, I am no smarter than most investors and make my share of investing mistakes chasing "total return". I am currently 45% in bonds (Ginnie Mae's, Corporates and Muni's in the 5-7 year maturity range and reasonable duration risk) and 45% in stocks that are mostly dividend growth companies. I am retired and live off my earnings. After a 20-30 year bull market in bonds, I don't see any reason to increase my allocation now and will cut it to 30% over the next two years given the Fed will eventually find a way out of the deflation trap they are in and get good ole inflation kicking! (oops, sounding a little "intellectual" now). I am no longer a subscriber to the Modern Portfolio Theory that I was taught in school, but I do believe in some reasonable diversification with my Muni's to keep taxes down and a good slug of MLP's for both income and tax deferral. My remaining 10% of my portfolio is either in cash or a play on specific growth stocks such as Apple.

    I do believe in "total return" and am currently harvesting some capital gains from my 2008 purchases of blue chip dividend growers that are up some 30-40%. I will sell part of this portfolio and reinvest the capital gains into new dividend growth stocks. I have no use for sell-side analysts at the major brokerage houses having seen up close and personal how that business works when I worked on Wall Street as an equity investor in a firm that had a brokerage arm. They are asset gathers, fee chargers and do not have your best interests at heart. I'm all into any criticism that helps me improve my portfolio's performance and minimizes my risk. I have found a steady handful of writers here on SA that have kept me on my toes. Please join us in achieving our goals and never make it personal. (Five Plus, sorry for your loss and ignore Larry.)
    Jan 13 06:29 PM | 18 Likes Like |Link to Comment
  • Income Investors Take Note: Man Can't Live on Dividends Alone [View article]
    The "studies" basically imply a steady growth rate for stocks and bonds. But like so many Performa discounted cash flow models used in acquisition deals, these studies don't show down years a few years out as this really skews the results. If you take 4% in a year of zero growth in your portfolio, you fall behind unless you have an 8% year soon. "notbob", you are correct to ask to see the beef. Sometimes, I think these investment models are like drug studies paid for by the drug companies. Tell me the result you want and I will structure the program to achieve the desired result. The 4% concept is basically 4% for 20-25 years with a little appreciation to make up for inflation until it's all gone. I have reviewed numerous Monte Carlo simulations around this theory and they have numerous variables that they claim are properly risk-adjusted. I'll stick with a dividend growth strategy coupled with a careful monitoring of my bond portfolio to make my money last a long, long time given the uncertainties ahead.
    P.S. The other reason the 4% plan is pushed is because "you" should put your money in mutual funds where the adviser gets his annual fee and your management fee is buried in your statement. Only a small number of fund managers deserve this fee; the rest are closet indexers.
    Mar 9 11:45 PM | 15 Likes Like |Link to Comment
  • You're Retiring: Where Is Your Income Going to Come From? [View article]
    David, I can't poke a hole in your logic and am a retired dividend investor. As some comments have noted, there are a number of reasons why the "average" saver can't or does not follow this strategy. I have thought about how I have approached this subject over time and how my former fellow employees and extended family members have done so. So, cynically, here are my observations:

    1. We are taught to be diversified. See Fidelity, Vanguard, etc. There are many studies and accompanying statistics to show how different asset classes perform against each other in varying economic periods and you are shown various model portfolios to follow.

    2. If you have limited funds to invest, as most savers do, you are directed to mutual funds to effectively buy a basket of stocks and not incur the transaction costs. Of course, mutual fund fees are automatically subtracted from your returns so you never see them.

    3. All of this rolls up neatly in 401K plans that offer limited choices of "diversified" mutual funds. For those of you that don't know this, most executives pick a plan provider because the provider will handle the company stock and executive's stock option exercises at a small cost as part of their "services". Also, the provider usually picks funds that have the annual 25 basis point 12b fee attached that goes to the provider. Most providers (brokers) want this passive fee so they don't have to work with smaller savers(overhead efficiency). Additionally, the provider has a maintenance fee attached to your 401k account. Providers can be useful here, but the bidding process isn't as fair as you might think. I rolled over my 401k's to self directed IRA's.

    4. The average worker bee in a 401k plan has very limited financial knowledge and is told they should stick to diversified mutual funds. In other words, they do what they are told because thy don't know any better and are genuinely afraid to step outside the box.

    5. As a so-called highly educated worker (MBA-Finance) and former worker bee and top executive, I followed this path for thirty years because I was too busy and was more interested in "accumulating wealth". Once I retired, I realized that I was now scared of following the "4% rule" of retirement spending and shifted into two portfolios of a.) dividend paying stocks with a minimum 3% threshold, b.) growth stocks for capital gains and c.) a bond portfolio that also has a minimum 3% yield. I sleep well at night.

    I now live off this portfolio as I have a very tiny pension and pay for my own healthcare with a high deductible plan (don't get me started here!). My dividend paying stocks are primarily blue chips, REIT's and MLP's. I am comfortable with this plan and now monitor my mutual fund bond portfolio (mostly GNMA's and Muni's) for the pending increase in interest rates. I may shift more to stocks (now about 50%) if interest rates spike. I want to thank you and the other regular commentators who contribute their insightful ideas here on SA ad a few other worthy websites. The average retiree is in for a shock over the next twenty years as his or her mutual fund portfolio is depleted via the 4% formula. I'm surprised that a Vanguard doesn't really offer a low cost mutual fund of high paying dividend stocks that mimic your strategy. Keep up the good work!
    Mar 8 11:07 AM | 15 Likes Like |Link to Comment
  • Goldman Sachs Updates Its Conviction Buy List [View article]
    Should Goldman also issue their trading positions in the same stocks when they add them to the Conviction Buy list? Did they establish a trading position in these stocks a month or two ago and now are trying to lure retail and mutual funds back into these stocks as they sell from their own book? Beware sell-side firms suggesting you buy when the horse is trotting out of the barn and the market has already run up.
    May 6 11:49 AM | 15 Likes Like |Link to Comment
  • Seadrill: Don't Fall For The Dividend Trap [View article]
    The author's header states he "is a top rate analyst". For an analyst who doesn't know the difference between cash flow and EPS, this article is totally useless. SDRL does have a high debt load, but the cash flow is sufficient to cover debt service and pay the dividend. Management is strong and they have newer rigs. Long: SDRL, NE, RIG
    Mar 22 10:21 AM | 14 Likes Like |Link to Comment
  • Rational Market Theory and Black Swans in Healthcare Reform [View article]
    As a self insured investor, I can tell you that the private market for health insurance is outrageously expensive and the author is correct. Either accept the high deductibles for a reasobale monthly premium (and hope you don't end up in the hospital) or wing it. I buy this insurance to get the so-called group rate which is approximately 40-50% less than full retail. The insurance companies load in exemptions for pre-existing conditions and other "niceities".

    How about a true competitive market that is not controlled by lobbyists for Big Pharma and the insurers? People are screaming for capitalism. Me too. Oligopolies are not a fair and competitive market. As an investor, I should be concerned and lok to expoit nuances in the market. As a citizen, I don't like being expoited.
    Aug 17 10:15 AM | 13 Likes Like |Link to Comment
  • Master Limited Partnerships: Pipe Dreams or Shark Jumpers? [View article]
    The usual fear mongering that frequently accompanies individuals who are short term traders. Yes, there is notoriety but there is real cash flow backing these companies versus the hype of the dot com era and MLP's are not selling at multiples of 70 to 100 times "value". As the author noted, most MLP investors are there for the income over time. Most MLP's are trading at an all time high and now is not a good time to build a position. As more and more investors seek income from their investments, MLP's will remain an attractive vehicle. Note: Long EPD, KMP, LINE, BBEP, GEL, NS and ETP.
    Feb 7 02:24 PM | 11 Likes Like |Link to Comment
  • Retirees Please Don't Index, You Deserve Better Than Average [View article]
    Pampano, don't you consider this a concentrated risk in Chinese companies (60%)? The risk here is that China makes the transition from an export economy to a consumer driven one and this will be very difficult. The numbers sound great and you say this will make a tidy profit for a pension account. I wonder how you handicap this risk?

    Further, many people keep talking about the eventual rise in U.S. interest rates due to a growing economy. I believe many are also coming around to the idea we may be a slow growth economy (1-2%) for many years. Interest rates may not spike as their isn't sufficient demand in the economy. The middle class borrowed their way to disaster over the last two decades as their wages remained flat. They are still overleveraged and wages are going nowhere due to globalization, advances in technology, etc. I would agree investment growth might be better elsewhere. However, I get a fair amount of exposure to Europe, Asia and the emerging markets through U.S. blue chips. Regards
    May 30 11:23 AM | 10 Likes Like |Link to Comment
  • Debt Ceiling And Stocks: Why The Media Is Deceiving You [View article]
    James, I usually enjoy your articles, even if I disagree. However, this article does appear to me as a pandering to one point of view. I get the technical point of no real default, but you make light of not paying other bills. Eventually, VA pensions and Social Security recipients would come up short and all hell would break out politically. How about not paying military contractors after all the lobbying dollars (graft) that was spent securing these deals?
    Does a major reform of entitlements include the elimination of corporate welfare, especially aggro subsidies to some Republicans in Congress that want to cut food stamps? How about carried interest? How about the preferential treatment of capital versus labor with wages stagnant for over a decade? Let's eliminate all these "entitlement subsidies", reduce the corporate and individual tax rates and increase the tax rate on the wealthy and institute a single payer health system. Otherwise, the media wars continue with lobbyists turning their fine spin from the poor and middle class (the 47%) to seniors. After all, it's their fault (the "moochers") that we have too much debt and all these entitlements will cripple the system in the future. That's the current spin from K Street. It's never the unfunded and unbudgeted wars and endless criminal behavior of the too-big-to fail guys. (How about another toxic CDO to go with your bagel, sir?) By the way, all the changes I recommend will affect me directly. I saw the real cause of our problems because I worked with them. I understand you call it as you see it. Try to broaden your vision and take a walk in other peoples shoes. Regards
    Oct 18 03:33 PM | 10 Likes Like |Link to Comment
  • How To Take Some Of The Risk Out Of Tobacco Investing [View article]
    billinsd, please take your political rantings somewhere else, like Marketwatch. This is an investment website for investment ideas.
    May 12 12:40 PM | 10 Likes Like |Link to Comment
  • Retirement's 4% Rule: Surprising Answers You Need to Know About the Inflation Factor [View article]
    The outlook for a stagnant economy is very real for the next 3-5 years given housing prices (reduction in net worth) and high structural unemployment. I am budgeting a 3.5% growth rate on a portfolio of 50% dividend paying stocks and 50% intermediate corporate and muni bonds. My cash flow is mostly dividends and interest as any capital gains portion will be eaten up by future inflation relative to the portfolio's purchasing power. I have moved to a dividend growth stock strategy over the last five years and hope to avoid the "4% rule" entirely.
    Jul 27 12:03 PM | 10 Likes Like |Link to Comment
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