The Long Term Investor

Discussion in 'Investing' started by WXYZ, Oct 2, 2018.

  1. WXYZ

    WXYZ Well-Known Member

    Joined:
    Oct 2, 2018
    Messages:
    12,329
    Likes Received:
    4,440
    The APPLE stock split is the perfect example of HUMAN behavior. ALL the investing writings will tell you that a stock split is a neutral event. BLAH, blah, blah. BUT.......yesterday when this split was announced the BUZZZ was immediately noticable. Articles poped up everywhere. People are talking about it. Shareholders are excited. It.......will not.....be a neutral event.
     
  2. WXYZ

    WXYZ Well-Known Member

    Joined:
    Oct 2, 2018
    Messages:
    12,329
    Likes Received:
    4,440
    AND.....just as FOOD FOR THOUGHT.....

    Should Dr. Fauci Be the Economic Czar?

    https://www.aier.org/article/should-dr-fauci-be-the-economic-czar/

    MY COMMENT

    Right.......up front.....on this post. My opinion...the last person I want making economic decisions...or ANY decision for that matter.........for the WHOLE country........... is some unelected government health care beurocrat. Give your opinion to the President or others that are elected to make the hard choices and........sit down and shut up. THAT.........is ALL I will say. BOLD is MY OPINION below:

    Should Dr. Fauci Be the Economic Czar?

    https://www.aier.org/article/should-dr-fauci-be-the-economic-czar/

    "Dr. Anthony Fauci has had a tremendous and honorable career in the field of medicine. He has served as the Director of the National Institute of Allergy and Infectious Diseases and has advised multiple United States presidents. He has seen the country through a number of pandemics such as HIV/AIDS, Ebola, Zika, and now COVID-19.

    AIER has extensively covered COVID-19, particularly the devastating economic consequences that have resulted from draconian lockdown policies and media-driven hysteria. Dr. Fauci is certainly a tremendous medical professional. Oftentimes he is praised for his ability to keep politics out of public health. He is known for giving an unbiased and straight commentary on the issues facing the health of the nation.

    The problem is when Fauci starts to deviate into the realm of public policy, which is inherently political. There is no such thing as an unpolitical solution when the force of the state is involved. In particular, he has made plenty of statements on how he feels the economy should be managed. Whether it is the implementation of lockdown measures or comments on what he feels is an appropriate time to “reopen the economy,” Dr. Fauci has either implicitly or explicitly spoken on matters of economic policy.

    Furthermore, many public health experts have gone even further, signing a letter making explicit demands about resetting lockdown measures, reclosing “nonessential businesses,” barring interstate travel, mandatory mask orders, and many other awful ideas. Not only are the policies they advocate for outside the realm of scientific or medical research, but they are also just bad ideas in general with no basis in real-world application.

    These suggestions not only come from a position of tremendous privilege and insulation from the consequences of their policies, but are clearly outside of the expertise of public health.

    However, nothing in this article should be construed to suggest that one needs a title or an extensive background to comment on economics or any other subject matter. Ideas should be engaged on their merits, not the qualities of the bearer. AIER scholars like Phil Magness routinely engage and critique the flawed models of epidemiologists through the utilization of reason as well as interdisciplinary knowledge. At the end of the day, if Dr. Fauci and others in the medical field want to step into the arena of policy and economics, they are free to do so. However, they should also understand that medical knowledge is not enough to make policies that are appropriate for running a society.

    Evaluating Fauci’s Ideas
    Dr. Fauci has made a number of recommendations that certainly fall under the realm of economic policy. The most obvious point he tends to make is on the continued use of lockdown measures. Not only does he advocate for such policies but he also makes comments on specific aspects such as how long he thinks businesses should stay closed, the general effectiveness of lockdowns, and what he thinks of the economic tradeoffs.

    Fauci remarked during a congressional committee that

    “I served six presidents and I have never done anything other than tell the exact scientific evidence and made policy recommendations based on the science and the evidence.”

    Although there is nothing wrong with having a trusted expert like Fauci commenting on issues of medical importance, he must also recognize the shortcomings of his judgment. Nobody is in a position to understand all the moving parts of society, especially at the federal level. That is fundamentally why many economists are in favor of free markets and not government command and control. The government is not in a position both physically and philosophically to be micromanaging people’s lives from 3,000 miles away. That’s because there are tradeoffs and consequences that are oftentimes unseen by policymakers but felt by those at the microlevel.

    When CNN’s Anderson Cooper asked Fauci “Does it make sense to you that some states are still not issuing stay at home orders?” Fauci replied

    “I don’t understand why that’s not happening. (this BOLD is part of the original article) As you said, the tension between federal mandates vs states rights is something I don’t want to get into but when you look at what’s going on, I don’t understand why we’re not doing that. We really should be.”

    It should raise a few eyebrows that someone at the highest levels of government does not understand why some states would be reluctant to essentially place all their citizens under house arrest. Such a policy not only violates the conscience of American liberty and the notion of a free society but also the effectiveness is questionable. Furthermore, there are a number of countries and states that didn’t lock down that have shown either similar or better results as those that did. The case for stay at home orders not only lacks clear evidence for their effectiveness but carries a plethora of awful tradeoffs.

    Stay at home orders and lockdown measures more generally have economically devastated the country. Businesses are closing, lives are being destroyed, and communities are being drained of life. The American Physiological Association warns that the effects of lockdowns and social distancing will lead to adverse mental health outcomes for countless Americans. Substance abuse, domestic violence, and suicides are all increasing in part because of the social and economic devastation these policies have brought upon society.

    No society was ever built by micromanaging people’s lives and relegating the agency of individuals to the will of experts. Breaking down social barriers and restraining government was how we unleashed human potential. The potential to build prosperous civilizations capable of eradicating disease and ensuring the most vulnerable are protected.

    Such contempt and misunderstanding of these principles are reminiscent of the big government experiments of the 20th century. Stay at home orders and other lockdown measures bear a troubling resemblance to the brave new world of omnipotent government. Where society is nothing more than a testing ground for the theories and egos of experts. So perhaps Fauci is missing something when he says he doesn’t understand why more states haven’t implemented stay at home orders.

    When asked about when the country can start to reopen the economy he responded by saying

    “We are hoping that, at the end of the month, we could look around and say, OK, is there any element here that we can safely and cautiously start pulling back on? If so, do it. If not, then just continue to hunker down.” (this bold is part of the original article)

    The problem is that some people can’t afford to just “hunker down.” Whether it’s economic devastation that destroys businesses large and small, social repression that leads to substance abuse and suicide, or a generation of students losing out on key developmental experiences in their lives, keeping the economy closed isn’t just “hunkering down.”

    There are serious consequences that come from draconian lockdown policies, and it doesn’t look like Fauci is able to appropriately account for them. Eventually, there comes a point where the social and economic costs of closing down society drastically outweigh the marginal benefits of reducing infections. Perhaps reducing the number of COVID-19 cases is the only thing Fauci may care about, but there are a plethora of other problems in society, some of which were exacerbated by the decisions he endorsed.

    Furthermore, Fauci and other public health experts might think their policies work based on their computer models, but how they play out when real human beings are involved is another thing entirely. This is why all throughout the country and even the world we see the emergence of anti-lockdown protests. The reason is quite simple, and it is that people eventually get fed up with having to be arbitrarily prevented from living their lives. Eventually, there comes a limit where people are not only unwilling to obey overly restrictive policies but also see their fellow citizens’ lives destroyed as a result.

    However, Fauci doesn’t seem to be totally ignorant from the economic devastation brought on those who must live under his recommendations. On NBC he remarked

    “I know it’s difficult. We’re having a lot of suffering and a lot of death. This is inconvenient from an economic and a personal standpoint, but we just have to do it.( these bolds are part of the original article)

    The ongoing economic and social devastation is “inconvenient.” People’s lives are being destroyed, communities are crumbling under the boot of lockdowns, and the social fabric of the nation is fraying. The development of a generation of students is in danger because of school closure policies that will unleash far more devastation compared to the infections they may prevent. Power-drunk state governments like the Cuomo administration in New York forced COVID-19 patients into nursing homes while barring them from conducting further testing. On top of all this, it’s possible that it could have all been avoided as it turns out the epidemiology models used to inform these decisions were wildly incorrect.

    Dr. Fauci says that this is simply “inconvenient” and “we just have to do it.” That should tell you all you need to know about how in tune he is with the consequences of his own ideas. Consequences in which understanding is necessary for making informed decisions about the economy and the nation.

    The Verdict
    Much like how I would not want to have my ideas regarding COVID-19 to be barred from the discourse solely because of arbitrary restrictions based on titles and certifications, I would not do the same to Fauci on matters of economics. After all, who should be the arbiter of acceptable opinion? We are better off when we are able to engage with and hear solutions from all sorts of perspectives. Ideas should be judged on their merits and not the qualities of the bearer. Although I criticized Fauci’s comments on the economy to a great extent sometimes he says things that I agree with, such as when he said,

    “Stay-at-home orders intended to curb the spread of the coronavirus could end up causing “irreparable damage” if imposed for too long.”

    He also said that

    “The United States doesn’t need more widespread lockdowns to bring its COVID-19 outbreak under control.”

    As the saying goes, even a broken clock is right twice a day. These comments also seem to be a little contradictory to his previous statements but it’s nice to see Fauci coming around nonetheless.

    Ultimately there should be no barrier that disqualifies an individual from commenting on the economy. Much like how the response to COVID-19 requires understanding and input from a variety of perspectives, the same goes for economic policy. Dr. Fauci and public health experts like him have more than a right to voice their opinions on the economy. Whether or not we should take them seriously is another question entirely." (THIS BOLD is MINE)
     
    Jwalker likes this.
  3. Trahn Thompson

    Trahn Thompson Active Member

    Joined:
    Jun 13, 2019
    Messages:
    131
    Likes Received:
    89
    Yep Dr. Fauci is a government funding whore for many years. Fear and lies just make more money simple as that. If you can fake news you can fake science. Happy Investing!
     
  4. Trahn Thompson

    Trahn Thompson Active Member

    Joined:
    Jun 13, 2019
    Messages:
    131
    Likes Received:
    89
    On the investment front. Sold UPS @140 my plan was to sell @125 but by luck it closed the day before they reported 2Q @123. Had two companies that I would like to hold long term planned for when I sold UPS. Bought DG and V. Happy Investing!
    My Stock Holdings

    AMZN
    AAPL
    NKE
    HD
    MMM
    MSFT
    DG
    V
     
    TomB16 likes this.
  5. T0rm3nted

    T0rm3nted Moderator
    Staff Member

    Joined:
    Apr 2, 2016
    Messages:
    8,447
    Likes Received:
    3,268
    To be fair though, they also posted great earnings, so the increase isn't solely based on the split
     
  6. A55

    A55 Well-Known Member

    Joined:
    Jun 28, 2020
    Messages:
    1,033
    Likes Received:
    240
    The split should be fine.
     
  7. WXYZ

    WXYZ Well-Known Member

    Joined:
    Oct 2, 2018
    Messages:
    12,329
    Likes Received:
    4,440
    Yes, T0rm3nted......I agree. Those were certainly great earnings. I will be interested to watch the behavior of the stock from now till the day of the split. We have a whole bunch of NEW investors over the past 15 years that have little to no experience with stock splits. Prior to that they were routine and normal.

    I HOPE this starts a trend of renewed stock splits for successful companies with high share prices.
     
    T0rm3nted likes this.
  8. WXYZ

    WXYZ Well-Known Member

    Joined:
    Oct 2, 2018
    Messages:
    12,329
    Likes Received:
    4,440
    ACTUALLY......my post above got me thinking that there might be a lot of newer investors that are not too experienced with stock splits. HERE is the basic info:

    Understand the What and Why of Stock Splits

    https://www.investopedia.com/ask/answers/what-stock-split-why-do-stocks-split/

    AND.....some other reading on the topic:

    Opinion: Stock splits have dried up — why that’s not good for the market

    https://www.marketwatch.com/story/s...-why-thats-not-good-for-the-market-2019-10-11

    Why Aren't Companies Splitting Their Stocks Anymore?

    https://www.thestreet.com/markets/why-arent-companies-splitting-stock-anymore-14584642
     
    T0rm3nted likes this.
  9. Show Me The Money

    Show Me The Money New Member

    Joined:
    Jul 16, 2020
    Messages:
    14
    Likes Received:
    4
    It is simple. A stock split means stock price will be half its price, so more people will be capable of buying these stocks, meaning more demand. And as it always has more demand means prices up.
     
  10. TomB16

    TomB16 Well-Known Member

    Joined:
    Jun 22, 2018
    Messages:
    4,270
    Likes Received:
    2,625
    There has been chatter about a TSLA split on a couple of EV channels but I don't think it's real. I believe Elon prefers the high price to keep some of the high school juniors away from the stock.

    I'm not sure if I'd like a stock split, or not. They could do a 30:1 split and that would bring it back to about 50. That seems about right, to me. A 50:1 split would bring the price down to 30; also in a reasonable range.

    Again, I have no expectation of a TSLA split in the near future.
     
  11. zukodany

    zukodany Well-Known Member

    Joined:
    Aug 4, 2019
    Messages:
    1,609
    Likes Received:
    1,172
    Interesting day today. Been averaging a 0.50-0.75 a day the entire week so I’ll take it. remember when I said I’m not buying anything this year? Boy do I suck..
    Sold half my DD at a 5% loss and got into GOOG.
    My strategy- if goog keeps tanking I’m buying more as it drops. If it goes up.. well who’s better than me??
     
  12. A55

    A55 Well-Known Member

    Joined:
    Jun 28, 2020
    Messages:
    1,033
    Likes Received:
    240
    is

    I think I bought some of your DuPont. DuPont and Dow should always have a place in this world. I add those sparingly whenever there's a dip.
     
  13. Show Me The Money

    Show Me The Money New Member

    Joined:
    Jul 16, 2020
    Messages:
    14
    Likes Received:
    4
    Its hard to know what Elon Musk may want for Tesla stock. But in fact that would be a great movement to gather capital.
     
  14. The Brontide

    The Brontide Active Member

    Joined:
    May 15, 2020
    Messages:
    277
    Likes Received:
    112
    I have to disagree on this logic.

    Everyone and their brother offers fractional shares now. It doesn't make Mr. Small Investor with $5.00 more able to buy shares than before a split.
     
  15. 姑爺仔

    姑爺仔 Active Member

    Joined:
    Jul 15, 2020
    Messages:
    119
    Likes Received:
    57
    I have auto manufacturing, aerospace & defense, oil, pharmaceutical, banks, insurance, real estate.......

    Not so good today, or this year. But it's part of a diversified portfolio. On some days, everything goes up. On other days, you have some losers. Tech is not guaranteed either. GOOGL did not perform today. My IBM and INTC have been a let down. CVS has been losing everything it gained.

    But there's been good times also where banks,real estate, insurance, financials,defense.....Were doing great.

    PSX_20200731_185754.jpg
     
  16. Jwalker

    Jwalker Active Member

    Joined:
    Jul 12, 2020
    Messages:
    105
    Likes Received:
    69
    Personally speaking, I’m not interested in owning a fraction of share. If I can’t afford a full share I’m not going to buy. Just my opinion though. There are many companies that I would be interested in purchasing but due to limited capital, it’s not reasonable to buy based on the price. Maybe I’m just old fashioned but if I buy something I want to own it. Not part of it.
     
  17. Jwalker

    Jwalker Active Member

    Joined:
    Jul 12, 2020
    Messages:
    105
    Likes Received:
    69
    Agreed. The president should take his opinion and also the opinions of business leaders and economists into account. Policy making always has trade offs but the president should be well informed from all positions. The biggest problem with having someone like Fauci make decisions is at the end of the day he isn’t accountable to anyone for bad decisions.
     
  18. A55

    A55 Well-Known Member

    Joined:
    Jun 28, 2020
    Messages:
    1,033
    Likes Received:
    240
    Interesting view.

    I buy fractions all the time. That's what a stock share is. A share. I own a fraction of a company. Not the whole company. When dividends are reinvested, I get fractional shares.

    I have shares of various ETF, mutual funds, closed end funds, bond funds....which is an even smaller fraction, of the hundreds of investments in those funds.

    Yet, I haven't bought a fractional share either.
     
    The Brontide likes this.
  19. Jwalker

    Jwalker Active Member

    Joined:
    Jul 12, 2020
    Messages:
    105
    Likes Received:
    69
    That’s a good point. The only difference is each share is a measurable unit and I don’t want a half of a unit. Maybe nobody will agree with me on that and it’s probably psychological but it just doesn’t interest me to buy a half of a unit of something. However, full disclosure I guess it’s hypocritical because I get partial units with my automatic 401k investments.
     
    The Brontide likes this.
  20. The Brontide

    The Brontide Active Member

    Joined:
    May 15, 2020
    Messages:
    277
    Likes Received:
    112
    I agree with the both of you, but reverting back to "making shares more affordable for the small guy", that was my basis in point.

    I love fractionals.

    But I am not saying I am a smaller investor.

    When I go to buy, likely in blocks, it just makes it so much easier for me to calculate, for example, the total cost.

    IE: 100 shares at $10.97 each, comes to $1097.00 .

    So I just buy $1100 dollars worth and call it good.

    Makes my books easier as it only Tally's dollars and cents, numbers of shares don't play a part in my bookkeeping method until end of year when cost basis may be needed for tax purposes.
     
    Jwalker likes this.

Share This Page