Skip to comments.Daily finance & investment thread (2-5-13 edition)
Posted on 02/05/2013 2:58:19 AM PST by dennisw
Daily finance & investment thread (2-5-13 edition)
Trying to focus on the markets for today and each day and the economic news
A number of people have talked about such a thread. Lets see how it goes. This is where you can impart some investment wisdom to your fellow
freepers. You can vent about the big one that got away. You can chime in how Obama is out to wreck American capitalism.
If you see another FR economic thread you like and want to link to it here, please do
Ping list -- on or off let me know here or via freep-mail. If I missed you then Fpreep-mail me
I’m still looking for more correction in the market.
Practically everything looks overbought per stochastic curves.I still haven’t seen what has been driving the big buying spree other than “irrational exuberance” to borrow a phase from the past.
The Fear & Greed Index looks to be finally dropping from the Extreme Greed end of the scale.
Don't know about wisdom, but will share my thinking and welcome critique and an answer to a vexing uestion.
I know investors come in all different stripes and forms, everyone seems to have their favorite sector and instruments, stocks or bonds or precious metals...
I manage my wife's and my 401K funds. I don't do this because I'm any great shakes bat finance, I do it out of frustration that any "investment counselor" we go to has an agenda - has something to sell, an account they want us to get into. It's not their fault - it's their job.
So we plod along, not making as much as we might, and hopefully not making terrible mistakes.
We've been "in cash" (meaning, of our available fund selections, investment bonds) until I thought I got the lay of the land after the election. At first I was befuddled to see the DOW start to rise, but then I realized that just like the last four years, our esteemed and fearless leader and his gang is going to do anything and everything in their power to prop up the American financial system - so, we're back in; ~1/3 Vanguard large cap growth fund, ~1/3 real estate fund, ~1/3 remains in cash.
A good article - especially page 2.
The correct response is - as far as is practicable - to get out of fiat currency and into real things: including real money (Gold and Silver).
Long-term bonds are death-traps.
Shares (on the other hand) are a share in real businesses with real assets and to a certain extent will preserve your buying power as the currency steadily devalues.
However we should be careful not to confuse the nominal gain in stocks (due to currency devaluation) with an increase in buying power.
Case in point:
I have similar plans. The ratios are different but the plan of using diversity of mutual funds is similar.
The TV ads show all the magic tricks available for everyone to make trades. Trading is for the nonprofessional a losing proposition. The better course is to select a diversified group of tested mutual funds and buy and hold. If trading is demanded, it should be done with a fraction that can be disintegrated or lost.
In essence, rather than bet on specific companies, bet on America. Buy holding a diverse group of companies, your investment bet becomes one of faith in the American economy. It is of course cylical but holding over the long term smooths the zags into an upward trending curve.
You prefer Vanguard, I prefer Fidelity. Either is good and there might not be all that much difference. Both have large followings and there is a lot written that can bus used to influence which of the myraid of these family of funds is right for you.
Lastly, as a conservative, buy Forbes and read it from cover to cover every two weeks. Over time you will learn a great deal.
Good to hear from someone “who gets it”.
(physical) Gold and silver are money...paper is not. Both are on sale right now.
I chose Large Cap because to my thinking large(er) companies are better suited to weather the storm of additional taxes and regulations that are sure to come.
Had a Republican administration come to power (however weak) I would have gone for small to mid cap growth. For now and in the foreseeable future, I think the small cap sector is going to get hammered.
But if my judgement history is any guide, they will out perform my current choices!
YUM and ADM both pulled back yesterday (for different reasons). I’ll watch ‘em rather than buy them. I took a haircut on FIO but will hold because M&A should be up this year (see APKT). It beat earnings so I’m still okay with it. My stocks held up yesterday even though the markets were down. I take that as a good sign.
Please add me to your ping list. Thanks
YUM has a company-specific problem. They have had a tremendous run driven by their popularity in China. Unfortunately, they now have a Chinese problem--the safety of the chicken supplied to them is in question. It's not quite "Is that chicken in your chow mein?" serious, but it certainly damages their image!
My guess is that the suppression scheme will become untenable in the 3Q this year, when Japanese pension funds may start fleeing the Yen in earnest. A miserly fractional percent adoption of physical precious metals by those funds would sharply reassert market forces on PMs.
Yeah, the China problem. As a foreign company you cannot expect the government to be on your side in any dispute no matter how black and white it is. CAT went over there to just get their nose bloodied. Cheating is endemic over there and even if YOU’RE not the one cheating, you’re guilty by association.
Any American firm (Boeing now) knows that opening a factory in China means your technology will be stolen sooner or alter and a Chinese firm will be producing your items a few years down the road.
Right now the ChiComs are stealing our super innovative fracking technology by buying into US companies. Which should be denied but of course Obama/Democrat traitors have allowed such buy-ins...on the scale of hundreds of millions of dollars
If someone stole my stuff and give me hundreds of millions of dollars for it, I’m not sure I’d class that as theft.
Also: ‘super innovative fracking technology’ belongs to the companies who invent it. They’re free to do what they like with it - including selling it. It doesn’t belong to casual spectators. We do not own it. It is not ours.
Lastly: current fracking tech requires a great deal of water as well as access to the right kind of shale deposits. China is not well-placed to use fracking within its own borders. They’ll get maybe 3% of their energy needs from fracking by 2020 - as opposed to the US becoming a net energy exporter by 2015.
Hope this is helpful.
If they want to frack, they'll be piping a lot of water from the Tibetan plateau. We'll see more friction with India over this in future years.
BULLSHYTE! China loves that libertine-libertarian free trader garbage. Fracking technology should be jealously guarded by US firms acting in the national interest of the United States of America. You may be a citizen of the world type but I am a citizen of the USA and know that America has an economic enemy called China. Chinese finally wised up and are net sellers of US debt but Japan and our other Asian allies buy it as a kind of payment for our military protection of them from China
If Chinese firms had this fracking technology and were doing great with it...No way would they allow us and other nations to have access to it. But then the Chinese are not into this “citizen of the world” jive
If so then China will steal our fracking technology and sell it their allies who have more suitable shale deposits
China will explore and do as much fracking as it can>>>