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scchan.2009

scchan.2009
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  • IBM: We've Been Here Before, And It's The Moment Buyers Get Rich [View article]
    I like DE as well - DE has an amazing brand name and reputation, and operates in a sector that should remain viable over the foreseeable future. DE does subject to highly cyclical nature of agriculture commodity prices. I bought some DE a few months ago.
    Oct 17 03:09 PM | Likes Like |Link to Comment
  • IBM: We've Been Here Before, And It's The Moment Buyers Get Rich [View article]
    I added a little bit to my existing holding, and I have no intention of selling. One thing I like about IBM is that it is a well diversified technology company, and that it has good resilient against negative winds and is highly adaptable. IBM remains a global leader in the business and engineering/science part of technology with many active projects (ranging from cloud, HPCs, AI to pure computer science research). IBM has not been involved in the flashy side of the consumer tech since they stop making consumer PCs (like the ThinkPad - I used to have one), and I remain hold to cautious view the future of tech is in the consumer side of things.

    However, I am personally not a fan of buybacks. I would rather save the money for development or as a buffer against major negative events. However, it is clearly the best time to do buyback when the share price is down.
    Oct 17 02:35 PM | 1 Like Like |Link to Comment
  • How To Get Over 10% Annual Returns For 20 Years [View article]
    I think it is hard for a family to save anything at all with 45K/year. However, it is very possible for an individual.

    It is not too efficient in investing in stocks via broker if you can only save by 100s per month - the trading fees will kill you. A mixture of low-expense no-load funds, companies that offer direct investment, and EE or I saving bonds are more workable.
    Sep 17 08:52 PM | Likes Like |Link to Comment
  • How To Get Over 10% Annual Returns For 20 Years [View article]
    I think the difficulty is essentially in finding reasonable mid-small caps. Many mid-small caps are heavily hyped and that is reflected in their valuation, and they are the one that has the biggest risks of not able to meet up with market expectations.

    There are reasonably valued and dividend-paying mid-small boring caps. Some of them actually been around for ... a rather long time. They do have sustainable business (as reflected by their valuation and their longevity), but they are not high flying as fully reflected by their capitalisation. Essentially such small-mid caps behave like their larger dividend large-mega cap cousins - someone stuck with slower growth, but are stable and reliable.

    I think in the long run, regardless of young or old investor, it is really hard to beat the market. The only thing you can tweak is bond-stock allocation as long as you stick to reasonable small-mid-large caps and avoid speculation.
    Sep 17 12:14 PM | Likes Like |Link to Comment
  • How To Get Over 10% Annual Returns For 20 Years [View article]
    I think people have taken "Previous results are not predictive" in not the correct meaning. No one knows what happen in the future, but the only data we have is from the past. Yes, you do not know if you can extrapolate from previous data, but it generally gives a rough idea of the viability of the business.

    Coke may not able to make as much money in the future (I do not know), but I know Coke sells beverages, and beverages generally sell all right, so the probability of Coke going out of business in future is less when compared with a business who is experimenting new products with no prior proven products. Yes, the potential upside of getting into such business is high, but downside is high as well - if products don't work, there you go.

    In some ways, looking back in time is a way to confirm if common sense tells you if a business will be viable. Previous financial results are metrics to the viability of the business, but don't forget your common sense.
    Sep 16 07:01 PM | 1 Like Like |Link to Comment
  • My Top Investment Priority: Buy IBM Stock [View article]
    I do own a wide portfolio of about 30-some companies. IBM is about 6% weight (2nd largest, Walmart has a slightly larger weight) in my portfolio.

    Depends on who you ask, some say even 10 companies are enough if you stick to major large caps which are diversified across different sectors. My portfolio is focused in large caps (10 billion+ market cap), but there is a handful of mid-caps and an oddball small cap (it isn't an American or Canadian company). The portfolio did reasonably well this year, but I took some short-term hit from the recent Potash Fertilizer Shock (so yes, that is why you need diversification from unexpected market moves - even good quality companies can get smacked out from left field).
    Sep 16 02:39 PM | Likes Like |Link to Comment
  • My Top Investment Priority: Buy IBM Stock [View article]
    A lot of traditional investment guides encourage people to do dollar cost averaging, usage of auto investment plan, and dividend reinvestment for this exact reason. Pick a reasonable company (doesn't have to IBM; can be AFLAC or MSFT - companies that the article's author has written about) and put on cruise control.

    The picking of a reasonable company is important; one of the greatest faults of investing is trying to pick the next winner or big thing. In reality NO ONE knows who is the next winner or the next big thing. But if there are enough people picking all choices, someone will get it right, and claim victory (but he/she may have just gotten lucky). So it is best to stick with reasonably sound companies.
    Sep 10 06:47 PM | 1 Like Like |Link to Comment
  • My Top Investment Priority: Buy IBM Stock [View article]
    IBM has been the you-cannot-get-too-wrong company in technology for a very long time. I have bought a number of IBM shares over last couple of years, and have continue to accumulate them this year with dividends fully reinvested.

    One thing I dislike many of the chit chat of tech stock has been too focused on the product coolness value and how one or two product makes and kills a tech company. Many like flashy tech companies. IBM is the boring technology stock, and it is not flashy (and IBM doesn't care people think if they are not cool). Yet IBM has survived the many up and downs for decades, has maintained sound fundamentals, and has evolved itself silently through the change of time with diversification into many different aspects of modern IT.
    Sep 10 06:41 PM | 1 Like Like |Link to Comment
  • Stocks: Strategies For A Challenging Decade Ahead [View article]
    Cash hoarding itself encourages deflation.

    It has been that way for Japan for 20 some years - that is QE is an integral part of Abenomics.

    A bit of inflation expectations: Up until recently, TIPS had negative yields (it finally turned positive last few months), which means many still believe inflation will pick up. The problem with inflation/deflation expectations is that we have money hoarders on one side, on the opposite side there are folks hate Helicopter Ben personally about QE. Even Krugman joked "Hating an economist with a beard is not sound investment strategy."
    Sep 4 09:37 AM | 2 Likes Like |Link to Comment
  • Stocks: Strategies For A Challenging Decade Ahead [View article]
    I think a key point to see if SP500 PE is overvalued is to compare with current interest rates. With 10-yr Treasuries now moving close to 3%, the spread between 1/PE and the Treasuries yields has narrowed considerably. Many stocks do remain reasonably valued - especially in tech, industrials, and commodities, but I think many traditionally defensive stocks (PG, Coke, Southern, Kroger, etc) are on the expensive side now. It isn't just defensive stocks in US, but many defensive stocks overseas are seeing the same problem (even Nestle has upper teens P/E).

    So yes, stock selection is a big deal now. I think the reason why many cyclical and sensitive sector remains cheap is investors seem to lack faith in the long term outlook of them. Anyway, most of the time such view is often wrong - IBM, GE and Ford blah blah have survived for such a long time. I would say show some balls to enter a position into them.
    Sep 4 08:43 AM | 1 Like Like |Link to Comment
  • Russia escalates dispute with Belarus, bans pork imports [View news story]
    Fertilizer and food (cow beef and dairy) products total up to 20% of the exports of Belarus ( http://bit.ly/17uukVF ). Another major hits to them via potash price drop or outright embargo of food products will hit Belarus hard.

    I really don't understand what the heck is top guys in Belarus thinking, this is a not winnable game. Anyway, dictators and politicians (humans in general) are known to do stupid things.

    Bill Doyle is smirking in Saskatoon.
    Aug 31 03:09 PM | Likes Like |Link to Comment
  • Report: Ackman selling entire J.C. Penney stake [View news story]
    Hedge funds have always been terrible way to invest - very high expenses, and under-preform index funds in medium-long term. I am sure you can even beat hedge funds easily by just buying coke and Walmart shares...
    Aug 27 05:27 AM | Likes Like |Link to Comment
  • Report: Ackman selling entire J.C. Penney stake [View news story]
    Not just how much HE lost, but how much OPM (other people's money) he lost as well ;-)
    Aug 27 05:25 AM | Likes Like |Link to Comment
  • Uralkali CEO detained in Belarus [View news story]
    The crooks in US is mostly involve people that deal with financials and complex securities and trades. For a long time, I refuse to buy any financial sector stocks. Other companies (like big name Walmart or P&G) have generally good regulatory and accounting procedures.
    Aug 27 12:52 AM | 1 Like Like |Link to Comment
  • The Leveraged Buyout Of America [View article]
    The fundamental "Bail me out or we ruin all" "Other people's money" and "pay me big bonus" culture has not changed within the big banks. If it is changing within US, it is not changing fast enough. We do see changes to that in some of the biggest names in Europe (HSBC, RBS, Credit Swiss blah blah blah), and those changes are backed by public pressure by European governments and tough European law enforcement. We are not seeing this in same in US. US regulators have been far more willing to go after European and Asian banks caught doing dirty stuff than US banks themselves.

    We need Glass-Stegall back. The bad news too much Wall Street lobbying money is being stuffed inside-the-Beltway. If you take monetary policy view, the helicopter money toss is a consequence that the Feds cannot lower interest rates further. The Feds don't make law, and monetary policy is only most effective if good fiscal and structural (aka regulatory) reforms move together.
    Aug 27 12:26 AM | 2 Likes Like |Link to Comment
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202 Comments
195 Likes