The Long Term Investor

gtrudeau88

The wash rule did not cost you anything in your profit. It will simply impact if you can claim the initial loss on your taxes.

 

ONCE AGAIN.....great work yesterday Emmett. The Zukodana model is tempting....but.....EMMETT is the MAN of the hour.

 

Who cares what they show.......on paper......for your gain or loss. That is for tax purposes. You gained what you gained in reality......what you put in....versus...what you ended up with. For most people not being able to write off a loss....due to the wash rule..... on their taxes is not going to matter in the least.

 

For the moment the DOOM&GLOOM over the ten year yield and inflation is over......for a few days. the story of the day today being pushed to panic investors.......WE ARE IN A BUBBLE. OMG.....the media says we are in a bubble.

Can stocks shrug off bubble talk? Wall Street thinks so

https://www.cnn.com/2021/03/02/investing/premarket-stocks-trading/index.html

(BOLD is my opinion OR what I consider important content)

"Financial markets have been rocked by volatility in recent days as investors try to game out how to play the next phase of the pandemic.

What's happening: After plunging 4.9% last week, the tech-heavy Nasdaq Composite rallied 3% on Monday, logging its best day since November. The S&P 500, which dropped 2.5% last week, rose 2.4%, its best session since June.
The seesawing could continue in the days and weeks to come as investors continue to weigh whether a boom in economic activity will trigger a rise in prices. But Wall Street is confident that stocks can weather the storm, thanks to vaccination campaigns, ongoing support from policymakers and a resurgence in corporate earnings.

"The resumption of the equity rally supports our view that last week's setback for stocks was a volatility spike, rather than a fundamental shift in the market outlook," Mark Haefele, chief investment officer of UBS Global Wealth Management, told clients Tuesday.

Haefele said that "notable changes in key variables," including the pandemic, fiscal stimulus, and inflation could lead to "periodic" turbulence. But he believes the market "can rebound quickly when these different market drivers combine favorably."

See here: Over the weekend, the United States authorized Johnson & Johnson's Covid-19 vaccine, while the chances of passing President Joe Biden's $1.9 trillion stimulus package appeared to improve after Senate Democrats decided to abandon an alternative proposal to penalize companies for not providing a $15 minimum wage.
Bond yields have also fallen back from last week's highs. That bodes well for stocks.

Meanwhile, expectations for corporate earnings are rosy. Following a 13% drop in 2020, Goldman Sachs thinks earnings per share for the S&P 500 will rise by 27% in 2021. That would put earnings per share 10% above pre-pandemic levels.

Big picture: Inflation fears and rising bond yields could cause investors to shift their attention to classic "value" stocks like banks instead of the high-growth tech names they've favored since last March. But Wall Street thinks the broader stock market can keep pushing ahead, even if there are a few hiccups along the way.

"It's too soon in the growth, policy and inflation cycles to be defensive," John Normand, JPMorgan's head of cross-asset fundamental strategy, said in a recent note to clients.

There are risks to that view, of course. Investors have been startled by the pace at which bond yields have jumped, though they still remain extremely low in historical terms. Another rapid spike could trigger additional anxiety.
And signs of excess enthusiasm in corners of the markets — from the popularity of special-purpose acquisition companies, or SPACs, to the recent bitcoin rally — keep feeding chatter about whether exuberance is getting out of hand.

The latest warning: One of China's most powerful financial leaders sounded the alarm over a potential bubble in global financial markets on Tuesday.

"We are really afraid the bubble for foreign financial assets will burst someday," Guo Shuqing, party chief of the People's Bank of China and chairman of the China Banking and Insurance Regulatory Commission, told reporters in Beijing.""

MY COMMENT

So some government stooge at the government bank in China....the worlds most brutal communist dictatorship.....makes comments about a bubble and the media jumps on the bandwagon. What in the world is wrong with people?

The short term FLAILING around with excuses, speculation, and fear mongering is just SILLY. The way I see it.....there is NO alternative to stocks and funds. Looking at the long term view.....the future for investors is very bright. THE....vast majority of retirement money is STILL going to go into mutual funds and stocks. The VAST majority of investors are still going to be in stocks and funds.....forever. They may try to jump in and out, they may try to market time, they may try to speculate, they may day trade and option trade,....but....in the end...they are STILL going to be invested in funds and stocks.

I have my two very simple goals for investing.......average 10% or more long term....and...short term try to beat the SP500. That is all I care about. AND.....I KNOW from all past experience and from ALL the data that is is NOT difficult to meet or beat goal number one. Goal number two is just aspirational....something to aim for....but as long as I hit goal number one.....it is all good. I will take a DOUBLE on my money every 7.2 years......and....the reality is it usually happens every 5-6 years over the long term.

YES......I will continue to be fully invested for the long term as usual.

 

As usual.....here is the path to investing success.....it is really not that difficult. EVEN though many many people out there want to make you think it is......they sell books, they want you to click on their silly articles every day, they want to manage your money...for a fee.....they want you to doubt yourself. There is a WHOLE industry out there that thrives on......YOU......and your investing doubt in yourself.

I am not sure if you are being sarcastic Zukodany....but we are not in a bubble. Perhaps the speculators that are investing in worthless REDDIT stocks are in a fantasy land bubble. BUT......the real markets dealing in reality are looking at the most positive economic future over the next 6-24 months in history. It is ALL a function of your time horizon.

As usual, Warren Buffett's letter was full of advice — here's how to apply it

https://finance.yahoo.com/news/usual-warren-buffetts-letter-full-233000603.html

(BOLD is my opinion OR what I consider important content)
"Every year, the Oracle of Omaha passes down sacred knowledge to his shareholders in the form of a letter.

For decades, Warren Buffett, one of the most successful investors of all time, has bestowed nuggets of wisdom, in his trademark plainspoken style, through his firm Berkshire Hathaway’s annual public report.

To call it an eagerly anticipated document would be a bit of an understatement.

The 2021 edition of the letter was released Feb. 27.

Observers in finance, politics and the media had hoped that Buffett, who refrained from public comment for most of 2020, would try to make some sense — and some dollars — out of the pandemic, the election, the GameStop trading frenzy, and all the other craziness currently shaping American life.

But, true to form, Buffett's letter didn’t talk about any of that, instead outlining his major (and surprising) strategy of repurchasing $24.7 billion of his own stock last year — something he generally advises against — and admitting he made a mistake five years back with the $37.2 billion purchase of Precision Castparts Corp.

Even if you can’t afford a whole $330,000 Berkshire Hathaway share with the help of your investing app, Buffett’s letter is always a worthwhile read for investors of all walks of life can benefit from.

Let’s get into some of the Buffett letter’s historical highlights.

Buffett’s top tips over the years

Buffett’s most significant lessons can be broken down into nine themes.

1. C-Suite not so sweet
In 1985, Buffett said he uses an incentive-compensation system at Berkshire Hathaway that sees managers rewarded for their individual contributions over the year, regardless of the company’s overall performance.

If they did get great in a middling year, they’ll reap the benefits. And if it was their work that was middling in a great year, they won’t be rewarded.

“We believe good unit performance should be rewarded whether Berkshire stock rises, falls or stays even,” Buffett wrote. “Similarly, we think average performance should earn no special rewards even if our stock should soar.

Buffett also acknowledges that “performance” means something different based on the specific business: “In some our managers enjoy tailwinds not of their own making, in others they fight unavoidable headwinds.”

But compensation from Buffett will never come in the form of stock options. Not only does that dilute the shares, executives can leverage their understanding of the company to add to their wealth — at the expense of shareholders.

2. Locked up in stocks
Buffett is famous for his slow and steady approach to investing. He doesn’t believe in owning stock you don’t believe in and fussing over a share’s daily movement.

Many people have been inspired by the recent GameStop saga to adopt the gunslinging approach of a Robinhood-toting Reddit day-trader.

But that's never been Buffett's way.

“If you aren’t willing to own a stock for 10 years, don’t think about buying it for 10 minutes,” he wrote in 1996.

And while he once overlooked intangible qualities like reputation and brand, in 1983, he revealed “that bias caused me to make many important business mistakes of omission, although relatively few of commission.”

3. Bull or bear, follow your gut

Buffett is adamant that the price of a stock is one of the last things you should consider when deciding whether to buy or sell shares.

What matters is the company’s underlying value. Because even though prices, as he put it in 1987, are subject to the emotional whims of “Mr. Market,” whose moods tend to move up and down on a daily basis, prices will eventually catch up and reward companies that bring value.

That applies especially when the market is behaving irrationally and he encourages investors not to worry about looking unimaginative or even foolish while standing in their convictions.

Furthermore, he suggests making market volatility work for you. In 2016, he offered this pearl: If you see the skies are about to “briefly rain gold,” you should “rush outdoors carrying washtubs, not teaspoons.”

Remember that next time you’re wondering whether it’s time to put money, even just a little bit, into the market.

4. Simple, not sexy, is successful
Buffett likes to invest in companies that invest in their own growth or use corporate capital to buy back stock.

Even if it doesn’t pay off in the short term, he believes strongly that companies holding back some of their earnings from shareholders to put back into the business helps grow their value over time.

That being said, for Buffett to be enticed to invest, a company has to be simple and often not sexy. He famously avoids buying into businesses he doesn’t understand.

While he and his business partner Charlie Munger personally welcome change in the form of fresh ideas, new products and innovative processes, professionally, they’re more wary.

“As investors, however, our reaction to a fermenting industry is much like our attitude toward space exploration: We applaud the endeavor but prefer to skip the ride.”

More importantly, they choose to invest in companies that make things people need that might not be exciting, cutting-edge investments, but are certain to offer returns for years to come.

5. Don’t trade the cow for magic beans
While some companies jump at the opportunity to take large positions in struggling companies, Buffett favors smaller positions in stronger firms.

“It’s better to have a partial interest in the Hope Diamond than to own all of a rhinestone,” he wrote in 2014.

But he doesn’t believe you should invest in a company solely because you believe it will grow. Value should always be your guiding principle.

And finally, you should avoid giving away more than you receive, a mistake Buffett says he committed when he made a bad deal with his own stock — which cost shareholders $3.5 billion in 1993.

6. Progress marches on

Buffett believes strongly in the economic future of America. And while pundits have been bemoaning the decline of the U.S. for decades, he sees it as the country simply becoming more efficient.

In his 2010 letter, he relayed that American citizens live six times better than when he was born in 1930.

That expansive view of history translates into investment strategies that deliver steady, reliable returns over the long haul toward retirement.

He picked up the theme of “never bet against America” in the 2021 edition of the letter.

“In its brief 232 years of existence, however, there has been no incubator for unleashing human potential like America. Despite some severe interruptions, our country’s economic progress has been breathtaking.”

7. Stick to your own pace in the rat race

Like a sloth, Buffett makes moves only when he has to. His 1996 letter related to investors that they’ll be better served by buying a few reliable stocks and holding onto them rather than trying to buy and sell at pace with the market. The same logic would apply even if you’re just buying pieces of stocks

He also encourages investors to trust their assessment skills of a business rather than with complex financial instruments or the recommendations of investment bankers, who have their own motives.

And when you’ve invested in a company, time will tell whether that was a worthwhile investment: “Time is the friend of the wonderful business, the enemy of the mediocre,” he wrote in 1989.

8. Culture club

Despite being one of the country’s wealthiest men, Buffett lives modestly. And he believes a leader who is careful with his money (and doesn’t push for exorbitant compensation) will encourage a culture of employees who are careful with their investor’s funds.

“Winston Churchill once said, ‘You shape your houses and then they shape you.’ That wisdom applies to businesses as well,” he wrote in 2010. “Bureaucratic procedures beget more bureaucracy, and imperial corporate palaces induce imperious behavior… As long as Charlie and I treat your money as if it were our own, Berkshire’s managers are likely to be careful with it as well.”

Part of what contributes to Berkshire Hathaway’s top-notch culture is who Buffett seeks out to hire. In a number of his letters, he has reminded shareholders that he seeks out managers who are often independently wealthy and don’t need to work.

Then Buffett creates the best possible work environment for them, ensuring they love what they do and make it so they could never be lured away.

So if you’re someone whose job involves hiring, make sure your next job posting talks about what you want in an employee but also why someone would want to work for you — and keep working for you.

9. You (usually) can’t dig yourself out of a hole

Unsurprisingly, as a careful investor, Buffett discourages anyone — but ordinary people especially — from going into debt to invest in the stock market. The swings of the market can leave consumers broke if it takes a sudden downturn.

But that doesn’t mean he’s entirely against using debt. Buffett does advocate borrowing money when it’s cheap to put the money to good use.

With Buffett and Berkshire Hathaway’s risk threshold and structure in mind, Berkshire primarily uses debt with its asset-laden railroad and utility businesses, which still generate plenty of cash even during an economic downturn.

The common threads in Warren’s written wisdom

At the end of the day, even Buffett has made his share of mistakes. But with his focus on steady, long-term growth, he always makes up for that over time.

So even if you’re new to the game, don’t get discouraged by the regular ups and downs of the market. In fact, Buffett discourages new investors from checking their portfolios every day for that reason exactly.

Instead make sure you:

• Take the long view and focus on long-term plans like retirement.
• Focus on slow and steady growth.
• Invest only what you can afford.

If you follow this advice, maybe you’ll one day be passing along your own pearls of wisdom to your adoring shareholders."

MY COMMENT

I know from the past 25+ years of posting on investing message boards that the majority of people posting on here......right now.....will be gone in a year or two. They will lose interest and move on or life will happen. BUT....this board will just be another short term stop along the way.

It is the same way with investing for most people....what they are doing right now will not be what they are doing a year or two from now. My opinion......the most important aspect of investing is to believe in yourself. AND...that means when you find what works for you and meets your investing goals......just STOP the constant looking and do what you do for the rest of your life. Most people have a hard time bucking the current trend or the current fad. The dont want to look dumb. They want to fit in. It takes GUTS and belief in yourself to be a good investor.....because.....to be a good investor you WILL have to go against the grain and the crowd much of the time. There will be CONSTANT subtle and not so subtle pressure.....TO CONFORM.

 

In line with the comment above:

Warren Buffett May Yet Have His Revenge on Dave Portnoy
His investing style is out of vogue, but market ructions could make it relevant again.

https://www.bloomberg.com/opinion/a...have-his-revenge-on-dave-portnoy?srnd=opinion

(BOLD is my opinion OR what I consider important content)

"No Market for Value Men

Dave Portnoy spent much of 2020 trash-talking Warren Buffett, calling the Oracle of Omaha an “old man” with investment ideas best suited for when “the year is 1862 and men travel by horse and buggy” and calling himself “the captain now.”

In many ways, insults aside, he was not wrong: It was a year when Portnoy and Cathie Wood and Elon Musk and Roaring Kitty had far more influence than Buffett, whose approach just wasn’t made for these times.


In his latest letter to Berkshire Hathaway investors this weekend, Buffett had an opportunity to fire back at Portnoy and other momentum traders currently having a moment. Instead, writes Tara Lachapelle, he simply defended his own value-focused style. He was modest and folksy with an extra helping of unpretentiousness on the side. That’s the Warren Buffett uniform, and it’s as unchanging as that of the New York Yankees. Lately it hasn’t been all that fun to watch. But it’s easy to imagine its time will come again, maybe soon.

Certainly in the very short term we seem to be at some sort of major market turning point, writes John Authers, with bets on a rapid economic reflation possibly pausing for confirmation. Given how high various assets have risen, it’s a bit like a tightrope act suddenly feeling wobbly mid-rope. And its safety net, the Fed, must be careful to encourage still more risk-taking without encouraging too much, writes Mohamed El-Erian. Good luck with that. Any blowups could remind the kids these days why value investing was once considered cool."

MY COMMENT

I do not particularly follow buffett.....but he is the perfect example of an investor that believes in himself and has the track record to prove it. Up or down...through thick or thin....out of style in style....he does what he does. HE DOES NOT blow around in the wind....chasing after the short term silliness.

 

My question today......where is EMMETT? COME ON MAN...lets get this market going. Quit admiring those clown oil paintings and get in there and kick the markets in the ass.

Actually..........not too bad of a day after yesterday. It is not unusual for the markets to have to pause for part of a day or more to digest some BIG GAINS.

 

YEP.....we each do what we do. The main thing......DO IT WELL......and meet your goals. Theoretical discussion......number 15.....I remember young people trading and doing EXACTLY what they are doing now.....back in the 1990's. At this point...I dont think there is ANYTHING that can happen with investors or markets that I have not seen.....usually....many times in my investing life.

It is like being a band leader.....at this point I dont get too excited about anything.....I have seen it ALL about 15-20 times in the past......there is nothing that can happen that is new........in investing or any business that I have been involved in for a long time. Including people saying it is the.....new normal.....and....the young guys are different. NOPE....it is all one big repeat of the past.

I remember about 5-10 years ago all the STUFF in the media about how the MILLENNIALS are so different.......NOPE. It was ALL just media hype. They are following exactly the same path as all past generations of the past 70 years. Get started with a job, live in the city or other hot area for young singles, get a better job or find your path, get married, have kids and move to the burbs for the better home and schools, grow the kids, send them off to college or life, downsize back to a city condo or smaller home or to a warm climate. Repeat over, and over, and over.

There is NOTHING new about any style of investing....trading, options, value, long term, momentum, day trading, futures, commodities, currency, etc, etc, etc.......they never change. The methods of executing them might change but the basic concepts remain the same as always.

AND....unfortunately...the majority of people trying to do each type that are successful will STILL be low. Their own personality, behavior, habits, and BRAIN will defeat them. The successful ones will learn along the way what works for them.....and that is what they will do. It is like the....."blind men and the elephant".....it is different to each of them....and at the same time....the same animal.