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kimboslice

kimboslice
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  • 15 Years Of Stimulus: Nothing To Show [View article]
    It's incorrect to even use the word "stimulus" in reference to low interest rates, since we saw that 0% interest rates for years did not stimulate the U.S. economy very much.

    Stockman notes that wages don't rise but he neglected to mention the elephant in the labor room: foreign labor (illegal and legal) which will inhibit wage rising.

    The law of supply and demand applies to labor also, so as more foreign workers come to work in the U.S. and compete with Americans, wages cannot rise because the increase in worker supply is exceeding the demand created by an anemic economy (2% GDP growth for years).
    Apr 8, 2015. 01:09 AM | 5 Likes Like |Link to Comment
  • Headwinds For New Tesla Financing: Estimates Declining And P/E Multiples At Historic Peak [View article]
    Guys who like Tesla as an investment are hoping the consumer suddenly changes his taste in cars. I wonder if he will.
    Today Tesla lives mostly on corporate welfare, but what uncle Sam giveth, he can take away.
    Some people think Tesla has the smart guys and Ford, GM, Toyota, BMW, etc are inept and can't compete. I doubt this.
    I can't figure all the enthusiasm for a company in such a competitive industry with such low sales.
    Apr 7, 2015. 11:12 PM | 7 Likes Like |Link to Comment
  • The Misunderstanding Of El-Erian's Cash Position [View article]
    It's easy to choose your asset class when 1. you're rich 2. it's a theoretical exercise The guy mentioned above is rich so he can own whatever he chooses.

    If you are 1. saving for retirement 2. plan on living (not dropping dead at age 65) 3. not making a fortune then you must be invested in stocks regardless of how you "expensive" you think they are today.

    Shares of Apple are expensive, but you can buy some and compounding the dividends will still help you reach your future financial goals.

    Compounding of dividends, interest and capital gains will make you rich over time.

    I do know someone who has been investing for over 60 years, she's 97 and richer than God. She didn't make that money working by any means.
    Apr 7, 2015. 05:15 PM | 2 Likes Like |Link to Comment
  • Tesla: Shattering The Lack Of Demand Myth [View article]
    Tesla is a rent seeking corporate welfare case disguised as a car company.
    It's a clever scam: how many government subsidies can they sucker people into buying?
    Telsa's profits are all welfare payments called credits.
    Musk/Tesla are the reincarnation of DeLorean.
    The consumer is not impressed with battery powered cars. This is unlikely to change since gasoline is inexpensive and likely to be replaced by inexpensive natural gas.
    AOL was a stock that also once made some traders a lot of money.
    Apr 7, 2015. 10:07 AM | 3 Likes Like |Link to Comment
  • Brokerages get tough with advisers who break rules [View news story]
    nyctexasbanker,
    The medallion signature process is a pain in the butt and Merrill and Morgan seem to be the only ones who require it.
    To get the medallion signature, you make an appointment with the person who can do it at the bank.
    He wants a copy of your entire document so if you are transferring out of Merrill/Morgan Stanley, you have to give the bank guy copies of EVERYthing, including your statement at the brokerage.
    In contrast, transferring your IRA from Fidelity to T.Rowe Price for example only your signature is needed, not a notary, not a medallion guarantee.
    Apr 6, 2015. 12:17 PM | 1 Like Like |Link to Comment
  • Brokerages get tough with advisers who break rules [View news story]
    Merrill and Morgan Stanley brokers are generally overpaid crooks and firing one or two is definitely a drop in the ocean.
    They should have gone extinct after 1929 when they lost clients' fortunes and mutual funds were invented. Somehow there are a few left.
    They changed from "brokers" to call themselves "wealth management" "financial advisers" because this sounds like they know something.
    If my post is boring, skip it here.
    The essence of financial planning is mutual funds. If you have met your financial needs and like collecting stocks or trading them, it's about as harmless as Jay Leno collecting cars.
    Brokers will trade stock portfolios and charge you a 1.37% fee for the privilege of not owning a mutual fund. You'll get hit with taxes and paperwork.
    Brokers will also charge you this fee on top of the mutual funds expense ratios, so your average expense ratio of a mutual fund owned in Merrill or Morgan is 2.33%
    My father had a Morgan Stanley broker who had paid FINRA fines in excess of $164,000. That broker wasn't fired, he was promoted.
    This broker held my father's money hostage; my father wanted to leave and wrote letters of instruction, while the answer was always "Let's meet face to face."
    My father wrote 5 letters and ended up waiting 7+ weeks to gain access to his own money market account.
    To transfer your money away from Merrill or Morgan, they require a "medallion signature guarantee", which is harder to arrange than a notary public.
    The broker is today a dinosaur but he is not yet extinct because there are other clueless dinosaurs out there like my father who think that a guy in an office must be a "professional".
    For example, the guy running the Boca Raton Florida offices of Morgan Stanley with dozens of brokers and profits of $123 million has a degree in *political science* from a college in Tennessee.
    My money is managed by a guy with a Harvard MBA or similar for 0.2%, not 2.33%
    Younger people are using companies like Fidelity and T.Rowe Price so hopefully these brokers go extinct someday.
    Apr 6, 2015. 01:02 AM | 2 Likes Like |Link to Comment
  • Why Are Interest Rates So Low? [View article]
    Bernake is an economist/university professor who may not have a proper perspective on how an economy can grow.
    "If all you have is a hammer, everything looks like a nail."=interest rate manipulation cannot create real economic growth or growing wealth.
    The real and only useful purpose of the Federal Reserve is, was and should be controlling inflation. Wage inflation happens with a fast growing economy.
    Paul Volker raised interest rates for this purpose, to slow down inflation.
    The converse of low interest rates stimulating economic growth is untrue and proven untrue in the last several years.
    Since 2009, GDP grew in US about 2% per year, while interest rates were about 0% That's proof that zero interest rates stimulate no real economic growth.
    Wealth is created by 1. production 2. innovation that increases productivity.
    Capital is excess wealth from 1&2 after taxes are removed. Taxes remove capital from the financial system, where is is wasted on solar, wind, welfare schemes, aircraft carriers, govt. employee pensions, etc.
    Productive people who have attained wealth will migrate away from taxes, see the situation in Palm Beach County, FL for example. It's growing on the wealth excaping taxes in New York, New Jersey, etc.
    Apr 4, 2015. 11:46 AM | 4 Likes Like |Link to Comment
  • Sears: A Lot Of Happiness That's Just Temporary [View article]
    Sears where I live is a ghost town in a downscale mall.
    Target, Macys and Kohls ate its lunch there.
    If Sears pawns the family jewels, things look desperate.
    Apr 2, 2015. 11:44 PM | 2 Likes Like |Link to Comment
  • Google Taunts Microsoft With $149 Chromebooks [View article]
    Chromebooks are pretty cool. My father had a powerful Macbook pro and he complained how heavy it was for him to move around. (He's 93)
    He only browses the internet and reads his gmail. I got him a 13" Chromebook and he thinks it's great.
    I was going to get him a Macbook Air but thought this experiment would be interesting and it's a success.
    I installed a Chrome browser extension to kill excessive browser tabs and now there are zero problems with my father using it.
    Apr 1, 2015. 11:02 AM | 1 Like Like |Link to Comment
  • Bill Gross: Going To The Dogs [View article]
    Read my comment carefully.
    I said some risk is unreasonable.
    I said a 5% investment in a risky investment could perhaps pay off.

    Of course a core investment in an index fund e.g. Total stk market is good for the reason i give: the huge diversity of the index mitigates the risk of the losers in the index.

    Not taking any risk is expensive, you won't get rich with investment grade bonds.
    Mar 22, 2015. 05:40 PM | 1 Like Like |Link to Comment
  • Bill Gross: Going To The Dogs [View article]
    Without risk, there is no reward. Is some risk unreasonable? Of course, I won't buy a specialty mutual fund "emerging markets", or a penny stock, etc.

    Diversity is the key to owning risk. If you have enough of it, the losers are well outweighed by the winners.

    A "risky" stock was Apple once upon a time. You made a fortune if you threw the dice and bought a few thousand bucks of AAPL in 1998. Suppose you took 5% of your financial net worth then and risked it on Apple?

    You can buy "safe" investments if 1. you have a lot of money 2. don't need much capital growth 3. have a lot of time to allow for compounding.

    Large dividend paying stocks are great until as overweight dinosaurs something small and nimble comes to steal his lunch. The answer is to own both the dinosaur and the small mammal.
    Mar 22, 2015. 12:18 PM | 1 Like Like |Link to Comment
  • 'The U.S. Is Broke' [View article]
    The U.S.A. is living beyond its means, using a credit card with a balance today of about $18,000 Billion dollars.
    The problem is with GDP growth only 2% since 2009, as the debt grows faster than the economy, there will be several results in the future:
    1. debt interest as % of GDP will rise.
    2. debt interest as % of tax revenue will rise.
    3. debt interest rising=less tax revenue to pay for things govt. does.
    4. inevitable rise in tax rates=less money in taxpayers pockets.

    The growth of govt worker state, welfare state, and military state is beyond the tax revenue so the credit card balance keeps growing.

    There is nothing inherently good about debt. Don't compare the USA debt to a house mortgage, the correct analogy is a credit card debt.

    A growing economy would increase tax revenue, but the people in DC have been more intersted in 1. windmill schemes 2. solar schemes (solyndra) 3. gay marriage 4. stopping a pipeline 5. gun control 6. takeover of healthcare (Obamacare) instead of trying to actually stimulate our economy.
    Mar 18, 2015. 12:25 PM | 13 Likes Like |Link to Comment
  • Don't Over Think It: Buy AT&T [View article]
    One danger to AT&T=VOIP

    Land lines are slowly going extinct. This cash cow is shrinking for AT&T. Your "land line" today can still be VOIP, not AT&T.

    Another danger to AT&T=cable. Fiber optic cable is vastly superior to "U-verse".

    Another danger to AT&T=prepaid wireless plans, e.g. Metropcs, Virginmobile, etc. My father pays about $100/month in a contract to AT&T and I pay about $40 no contract. Think throwing away $720/year is no big deal? Send me $720 bucks.

    AT&T is fighting back, they bought Cricket wireless (prepaid) and are looking to buy into the better technologies.

    Will the competitors for AT&T ruin things for dividend investors? Maybe not soon, the slow erosion may take a while.
    Mar 16, 2015. 11:50 AM | 3 Likes Like |Link to Comment
  • No, Apple Won't Acquire Tesla - And Here Is Why [View article]
    I'm an Apple fanboy and shareholder, but the car business is exactly the wrong business for Apple to be in.

    I guess on the other hand, if guys out there are nuts enough to pay $100K for a Tesla, they're just as likely to buy a $100K Apple iCar.
    Feb 20, 2015. 11:21 AM | Likes Like |Link to Comment
  • Sorry Big Mac, It's Going To Take Plenty More To Change This Company [View article]
    I agree with other posters, McDonalds has been slowly beaten by competitors over many years.
    Anyone who has been to an In-n-Out Burger is hooked for life. It's awesome compared to McDonald's in every way.
    But, also local small chains are killing McDonalds. I am visiting in Jupiter Florida and Palm Beach County has Pollo Tropical which is fantastic and not expensive. It serves grilled chicken with various other sides and lots of sauces, it's full of local workers at lunchtime. CR Chicks has wood roasted rotisserie chicken and they are also packed with customers. You would spend about $6 to eat like a king at both such places.
    Five Guys Burgers and Fries is also superior to McDonalds in all ways.
    McDonalds drinks is probably their salvation, I love their smoothies and coffee and coffee drinks.
    Food that is frozen before it is prepared is inferior to fresh food cooked just before you eat it. McDonalds food is stored frozen before it is cooked, and the consumer knows it tastes a little funny.
    Too bad but this is how capitalism works.
    Jan 30, 2015. 12:09 PM | 3 Likes Like |Link to Comment
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