The Long Term Investor

I like this little article.

Some Things I’m Never Going To Do

https://awealthofcommonsense.com/2025/01/some-things-im-never-going-to-do/

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

"A list of things I never plan on doing:

I will never go all in or all out with my portfolio. I’m never going to take my entire portfolio to cash because I’m worried about a crash or some terrible economic outcome.

Sure, I hold the majority of my investment portfolio in stocks but it’s diversified across geography, market cap and strategy. Plus I also have plenty of cash and a substantial investment in real estate.

I believe in creating an investment plan that is durable enough to withstand a variety of environments, not trying to predict what’s going to happen in advance.

Going to extremes can make it easier to hit a home run but you’re also more likely to strike out.

I will never get rich overnight. It’s not as sexy but I’m okay with building wealth slowly.

I will never see the Lions make it to the Super Bowl. I’m convinced the franchise is cursed.

I will never be certain about the future. I’ve read too much about the past to be confident about the future. History is full of unpredictable events so the only thing I am confident about is that the future will be full of them too.

I will never worship a number in my portfolio. I’ve witnessed far too many people get hung up on their portfolio’s market value to the point where they can’t force themselves to spend their own money for fear of falling below a certain threshold.

The whole point of saving and investing is delaying gratification in the present to enjoy some gratification in the future.

I’m spending my money.

I will never buy premium gas. Seems like a scam to me (this could also be tied to the fact that I’ll never buy a premium vehicle).

I will never go deep sea scuba diving. I read Shadow Divers. I’m not messing around with the bends and nitrogen gas in my bloodstream. Nope.

I will never drink coffee. I’ve made it this far. Why start now?

I will never stop exercising, writing, reading or drinking. Exercise is my favorite form of meditation. Writing is my favorite form of learning. Reading is my favorite respite from all the screens. And drinking is one of my favorite ways to relax, socialize, celebrate or drown my sorrows.

I’m never going to be at the forefront of a technological revolution. I’m not an ear-to-the-ground guy when it comes to new technologies.

I’ve been following the AI buildout but consider myself more of a dabbler than a power user of the LLMs. But it feels like I’m constantly being bombarded by the early adopters who think they have it all figured out:

You have to use the newest version of ChatGPT! No you have to use Claude now! Actually Perplexity is the best model! Sorry now it’s DeepSeek!

It’s fascinating to watch the AI revolution play out in real-time because it shows just how little anyone actually knows. While the tech industry was busy trying to sell us on crypto and the metaverse, OpenAI quietly launched and turned the world on its head.

Now we have a new LLM from China that comes out of nowhere, knocks the big tech stocks down a peg and completely changes how people view this space.

The tech people didn’t see this coming. The stock market didn’t see this coming. Even the guy who created DeepSeek didn’t see this coming. Greg Zuckerman profiled DeepSeek founder Liang Wenfeng at The Wall Street Journal:

Liang has been keeping a low profile and was surprised to see DeepSeek turn into a frenzy overnight, they said.

The sudden surge of people using DeepSeek’s models to pose queries caught Liang and the company off guard, and DeepSeek’s services have repeatedly crashed since Sunday. Liang worked with his team to address the demand before taking a break for the Lunar New Year holiday in China.

If the people who work directly in AI can’t figure this out I don’t see how anyone on the outside looking in will.

Just tell me when we can all have the Scarlett Johannson AI personal assistant from Her in our ear and I’ll dive in head first.

I will never let AI engulf my entire life. The world will certainly change if everyone has their own AI bot to make them more efficient. I’m sure my wife would love to have a personal assistant to help her plan out our kids’ calendar of practices, games and playdates.

Life will be easier when we can tell our AI assistant to book our travel, restaurants and business trips. Day-to-day tasks on the job will also be more efficient when you have a computer program that will never get tired, irritated or sick of your constant requests.

I’m sure there are dozens of ways this will impact our lives that no one is even considering at the moment. I’m all for it.

But I don’t see AI upending the things that truly matter in my life — watching my kids play sports, playing catch with my son, shooting hoops with my daughters, boating, taking the dog for a walk, going for a run, traveling, hanging out at the lake, etc.

The hope is that AI will allow us all to do more of the things that matter most.

At least that’s my hope."

MY COMMENT

AMEN...especially to the part above about once in a while enjoying your money. It is all about REASON and RATIONALITY.....which includes....knowing when to use some of that hard earned money to take care of yourself and your family.

My view is also in agreement with not having all your eggs in one basket. I view my assets in four categories that are ALL part of an integrated financial play. The pieces of that plan:

1. My stock accounts.

2. Real estate in the form of my home which is free and clear.

3. Hard assets in the form of art, antiques and collectables.

4. Cash or equivalent in the form of Social Security and Annuity income both of which are guaranteed for my lifetime. (I use the word "guaranteed" based on what I consider strong "probability")

I also consider it an "asset" that I have ZERO debt......and....everything I own is free and clear.

 

THIS....is more good news for the FED.....as usual.

GDP: US economy grows at slower-than-expected pace in fourth quarter

https://finance.yahoo.com/news/gdp-...xpected-pace-in-fourth-quarter-133310590.html

I look forward to the day when the obsessive focus on the FED is done with.

 

We are now open and GREEN. A good start for the big averages today. NOW....lets keep it going for a while.

 

Here is a bit on where we are today.

Stocks Up After Solid GDP as Tech Earnings Roll In

https://finance.yahoo.com/news/asia-eyes-soft-open-fed-223025461.html

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

"(Bloomberg) -- Stocks rose after data showed the world’s largest economy remains solid, which bodes well for the strength of Corporate America.

Big tech led gains on Thursday, with Tesla Inc. and Meta Platforms Inc. climbing on upbeat outlooks. Microsoft Corp. retreated after saying its cloud-computing business will continue to grow slowly in the current quarter. Traders are now eagerly awaiting to hear from Apple Inc., which is due to report results after the closing bell. United Parcel Service Inc. sank 13% on a disappointing revenue forecast.

Inflation-adjusted gross domestic product increased an annualized 2.3% in the fourth quarter after rising 3.1% in the prior three-month period, according to the government’s initial estimate published Thursday. The median forecast in a Bloomberg survey of economists called for a 2.6% growth.

To Neil Birrell at Premier Miton Investors, while the data is all a bit historic now, the economy is “doing just fine.”

“Overall, the economy is on firm footing heading into 2025, which should support risk assets given the strong linkage between economic growth and corporate profits,” said Josh Jamner at ClearBridge Investments.

The S&P 500 rose 0.4%. The Nasdaq 100 climbed 0.5%. The Dow Jones Industrial Average was little changed.

The yield on 10-year Treasuries declined one basis point to 4.52%. The Bloomberg Dollar Spot Index fell 0.3%. Euro-zone bonds continued to trade higher after the European Central Bank lowered borrowing costs for a fifth time since June.

Corporate Highlights:

• The collision between an American Airlines Group Inc. regional jet and a military helicopter near Ronald Reagan airport in Washington left no survivors on board the two aircraft, authorities said, making it one of the most deadly US air disasters in decades.
  
  
• Southwest Airlines Co. warned that costs will climb faster than expected as it grapples with heavy labor expenses, undercutting gains from strong demand for leisure travel.
  
  
• United Parcel Service Inc. projected annual revenue well below expectations, telling investors that a long-awaited rebound in demand for its parcel services won’t arrive this year.
  
  
• Tesla Inc. plans to launch a long-promised robotaxi business and get back to growing vehicle sales after a year of decline in both deliveries and earnings.
  
  
• Microsoft Corp. said its cloud-computing business will continue to grow slowly in the current quarter as the company struggles to build enough data centers to handle demand for its artificial intelligence products.
  
  
• Meta Platforms Inc. Chief Executive Officer Mark Zuckerberg exuded confidence in his company’s artificial intelligence strategy, saying 2025 will be a “really big year” in which its AI assistant will become the most widely used in the industry.
  
  
• Caterpillar Inc. warned that revenues will be “slightly lower” in 2025 as demand concerns weigh on the outlook of the heavy equipment maker.
  
  
• Mastercard Inc. reported earnings that beat estimates as the firm diversifies beyond its traditional payment network into anti-fraud services, data analysis and global money movement."
  

MY COMMENT

Sounds good to me. In fact...everything right now is pretty positive...if you strip out all the day to day fear-mongering media stories.

 

MORE....good news for NVDA. In fact it is hard to find any sort of tech news that is not BIG and GOOD news for NVDA. You would never know it by the recent market action in the stock.

Microsoft Cloud Growth Constrained by Data Center Shortage

https://finance.yahoo.com/news/microsoft-falls-reporting-slowing-growth-211142591.html

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

"(Bloomberg) -- Microsoft Corp. said its cloud-computing business will continue to grow slowly in the current quarter as the company struggles to build enough data centers to handle demand for its artificial intelligence products.

Revenue at the Azure cloud division will increase as much 32% in its fiscal third quarter, not much faster than it did during the last three months of 2024. The shares fell 6% to $415.79 at 9:33 a.m in New York on Thursday.

The Redmond, Washington-based software maker is considered a leader in commercializing artificial intelligence products, thanks to its close partnership with ChatGPT maker OpenAI. In the last year, Microsoft has unleashed a blizzard of Copilot-branded AI assistants, but efforts to monetize those products is taking longer than some investors would prefer.

Microsoft said Azure AI services grew 157%. But overall sales in the key cloud unit are being hurt by the fact that the company still doesn’t have enough data center capacity to meet customer needs, Chief Financial Officer Amy Hood said in an interview. She later told investors that the capacity constraints should lift by the end of the fiscal year.

The company has almost $300 billion worth of commercial service contracts that Microsoft must provide in the future and has not yet recognized as revenue, she said.

Demand remains strong, with commercial bookings — a measure of future revenue — rising 67%, “far ahead” of what Microsoft had expected, she said. Hood attributed that partly to Azure commitments from OpenAI.

Along with cloud rivals Google and Amazon.com Inc., Microsoft is spending more than it ever has in its history, outlays that mostly go to the chips and data centers required to fuel power-hungry AI services. The company has said it expects to spend $80 billion this fiscal year on AI data centers. Wall Street has begun to question the massive outlays, especially after the Chinese upstart DeepSeek released a new open-source AI model that it claims rivals the abilities of US technology at a fraction of the cost.

Capital expenditures during the quarter were $22.6 billion, the company said, exceeding analyst expectations of about $21 billion. The infrastructure buildout resulted in narrower margins in the cloud business.

Total revenue in the three months ended Dec. 31 rose 12% to $69.6 billion. Profit during the quarter, the second of Microsoft’s fiscal year, was $3.23 a share. Analysts estimated sales of $68.9 billion and profit of $3.12 per share, according to data compiled by Bloomberg.

The company said 13 percentage points of Azure’s second-quarter growth was attributable to AI, compared with 12 points in the first quarter. Microsoft said its AI revenue during the quarter reached the point where it would be expected to bring in $13 billion over the course of a year."

MY COMMENT

If you dig into the MSFT story a little bit what I see is extremely positive. AND....at this moment....all roads seem to lead to NVDA.

 

Here is the PLTR story today. it was very close to an all time intra-day high earlier today.

"So, why is Palantir trending today? The interest derives from its upcoming earnings report on February 3, 2025. Investors eagerly await the results, hoping for a strong performance that could propel the stock even higher. Analysts predict a positive earnings surprise, expecting continued revenue growth driven by new contracts and expanding market opportunities.

Analysts Still in Doubt

It’s not all smooth sailing for Palantir. Despite its impressive growth, some analysts remain skeptical. Concerns about the company’s high valuation have led to cautious stances from several experts. For instance, Morgan Stanley MS +0.71% ▲ recently downgraded PLTR stock to a Sell and stamped a $60 price target, citing overvaluation concerns after a 340% surge in 2024. This has shadowed the otherwise optimistic outlook, with some even predicting a potential 40% decline in stock value."

https://www.tipranks.com/news/palantir-technologies-gets-downgraded-before-q4-earnings-report

 

LOL....I am siting and listening to....."Mr Wonderful"....on Varney talking about how DeepSeek is a total rip-off of OpenAI.

 

To continue to beat a dead horse....here is the basic argument that DeepSeek is a rip-off. Of course true or not.....the Chinese dont care at all. They will BLATANTLY rip off anyone and anything with zero consequences. They have been doing it for decades while the world stands naked and mute.

OpenAI investigating whether DeepSeek improperly obtained data

https://thehill.com/policy/technology/5113470-openai-deepseek-data-theft/

 

Well.....NASDAQ is now slightly red. So a mixed market.

 

I had a small gain today. My red stocks were......AAPL, AMZN, and MSFT. It is ridiculous that MSFT was down by $27.....6.18%. If only I had some free money....load up the wagon.

I also lost to the SP500 today by 0.38%.

 

Wait and see....in the end Elon's purchase of Twitter....now "X"....is going to turn out to be a genious move and the vehicle that ties together all his companies.

Amazon reportedly boosts ad-spending on X in major U-turn

https://www.investing.com/news/stoc...ts-adspending-on-x-in-major-uturn-wsj-3840955

In the end they always come crawling back.......in spite of their supposed convictions. You can only stay seated on a HIGH HORSE for so long.

 

I like this little earnings BEAT.

Apple shares rise 3% as boost in services revenue overshadows iPhone miss

https://www.cnbc.com/2025/01/30/apple-aapl-q1-earnings-2025.html

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

"Key Points

• Although Apple’s overall sales rose during the quarter, the company’s closely watched iPhone sales declined slightly on a year-over-year basis.
• Overall China sales declined 11.1% during the quarter to $18.51 billion.
• Apple CEO Tim Cook told CNBC’s Steve Kovach that iPhone sales were stronger in countries where Apple Intelligence is available.

Apple's overall revenue rose by 4% in its first fiscal quarter, but it missed on Wall Street’s iPhone sales expectations and saw sales in China decline 11.1%, the company reported on Thursday.

But shares rose about 3% in extended trading after the company gave a forecast for the March quarter that suggested revenue growth.


Here’s how Apple did versus LSEG consensus estimates for the quarter ending Dec. 28.

• Earnings per share: $2.40 vs. $2.35 estimated
• Revenue: $124.30 billion vs. $124.12 billion estimated

• iPhone revenue: $69.14 billion vs. $71.03 billion estimated
• Mac revenue: $8.99 billion vs. $7.96 billion estimated
• iPad revenue: $8.09 billion vs. $7.32 billion estimated
• Other Products revenue: $11.75 billion vs. $12.01 billion estimated
• Services revenue: $26.34 billion vs. $26.09 billion estimated
• Gross margin: 46.9% vs. 46.5% estimated

Apple said that it expected growth in the March quarter of “low to mid single digits” on an annual basis. The company also said it expected “low double digits” growth for its Services division. Apple said it expected the strong dollar to drag on Apple’s overall sales about 2.5%, and after accounting for currency, the overall growth rate would be similar to the December quarter’s 6%.

Wall Street was expecting guidance for the March quarter of $1.66 in earnings per share on $95.46 billion in revenue.

Apple’s profit engine, its Services division, which includes subscriptions, warranties and licensing deals, reported $23.12 billion in revenue, which is 14% higher than the same period last year. Apple CEO Tim Cook told analysts on a call Thursday that the company had over 1 billion subscriptions, which includes both direct subscriptions for services like Apple TV+ and iCloud, as well as subscriptions to third-party apps through the company’s App Store system.

Although Apple’s overall sales rose during the quarter, the company’s closely watched iPhone sales declined slightly on a year-over-year basis. The December quarter is the first full quarter with iPhone 16 sales, and Apple released its Apple Intelligence AI suite for the devices during the quarter.

Apple’s iPhone miss versus LSEG estimates was the biggest for the company in two years, since its first-quarter earnings report in fiscal 2023. At the time, Apple said that its miss was because it was unable to make enough iPhone 14 models because of production issues in China.

In the first fiscal quarter, the company saw significant weakness in Greater China, which includes the mainland, Hong Kong and Taiwan. Overall China sales declined 11.1% during the quarter to $18.51 billion. It’s the largest drop in China sales since the same quarter last year when they fell 12.9%.

Cook told CNBC’s Steve Kovach that iPhone sales were stronger in countries where Apple Intelligence is available. Currently, the software is only available in a handful of English-speaking countries, and it isn’t accessible in China or in Chinese.

“During the December quarter, we saw that in markets where we had rolled out Apple intelligence, that the year-over-year performance on the iPhone 16 family was stronger than those markets where we had not rolled out Apple intelligence,” Cook said.

He added that the company planned to release additional languages in April, including a version of Apple Intelligence in simplified Chinese.

Cook told CNBC that there were three factors in the company’s China performance. He said that half of the 11.1% decline was due to a change in “channel inventory,” the fact that Apple Intelligence hasn’t launched in the region and that after the quarter ended, China issued a national subsidy that would stimulate some Apple product sales.

“If you look at the negative 11, half of the decline is due to a change in channel inventory, and so the operational performance is better,” Cook said.

The company reported $36.33 billion in net income during the quarter, up 7.1% from $33.92 billion in the same period last year.

In its fiscal first-quarter earnings report on Thursday, Apple reported a gross margin — the profit left after accounting for the cost of goods sold — of 46.9%. That’s the highest on record, surpassing the 46.6% margin the company record in the period ending March 2024. Apple said it expected gross margin in the March quarter to be between 46.5% and 47.5%.

Apple’s iPad and Mac sales showed strong growth over last year’s struggling sales in the holiday quarter. Mac revenue rose 15% to $8.98 billion and iPad revenue grew 15% to $8.08 billion. The company’s Mac division posted its best growth since the fourth fiscal quarter of 2022.

The company released new Macs during the quarter, including new iMac, Mac Mini and MacBook Pro laptops in October. Apple also launched a new iPad Mini during the quarter. Cook attributed the growth in those segments to new products.

“It’s driven by the significant excitement around our latest Mac lineup,” Cook said.

Cook told analysts on an earnings call that the company had an active base of 2.35 billion active devices, up from the 2.2 billion figure the company provided a year ago.

The company’s “other products” category, also called Wearables, which includes Apple Watch, AirPods, Beats and Vision Pro sales, declined 2% on a year-over-year basis to $11.75 billion in sales.

Apple said it would pay a dividend of 25 cents per share and spent $30 billion on dividends and share repurchases during the first quarter."

MY COMMENT

Many good numbers above and the majority are beats. I especially like the new.....ALL TIME HIGH....gross margin of 46.9%.

 

AND NOW....we are starting to see some REALITY creep in.....as usual.

DeepSeek Will Hardly Dent Magnificent Seven Stocks, Survey Shows

https://finance.yahoo.com/news/deepseek-hardly-dent-magnificent-seven-232859910.html