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The Long Term Investor

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

  1. WXYZ

    WXYZ Active Member

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    WELL.....everyone has their own approach. I learned LONG AGO that it is a waste of everyone's time to engage in AGE OLD arguments online about such topics. That does not mean that discussion is bad or should be avoided. I just tend to PERSONALLY not get into such topics. That is why I tend to focus on the type of news items and opinion articles and market info that I post.......to do my arguing FOR ME. It is my HOPE that the sort of stuff that I post will have an impact or cause THINKING in posters and lurkers. BUT.....if not......I dont care how or why anyone else wants to handle, invest, trade, use, or waste their money.

    (this is a general statement NOT directed at ANYONE on these boards)........I am secure in what and how "I" invest and handle money based on my personal and financial situation. I have been doing the same thing for a long time as a LONG TERM INVESTOR. Others, that I have no control over and no stake in what they do............can do whatever they wish, however they wish.
     
    T0rm3nted likes this.
  2. TomB16

    TomB16 Active Member

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    I respect your position of not wanting to ruffle any feathers. It's nice that we have found a topic on which we do not agree. Perhaps it will make this topic more interesting.

    My journey of discovering the lack of objectivity of the human organism and subsequent deep dive into my own objectivity profile (specifically: lack of it) is the keystone of my investing program. I cannot share my investing mission without sharing that, so it is what it is. Anyone who is offended by my point of view is not objective. That is not to say objective people cannot disagree with it or disregard it.

    I am in direct agreement with anyone who thinks that I am not objective.
     
  3. WXYZ

    WXYZ Active Member

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    Well said Tom. My reasoning is not about ruffling feathers.......it is just having participated in these sorts of arguments and discussions online for decades I have found it a waste of time and energy not to mention mental health and sanity. Of course, I totally agree with you about the human condition and total lack of objectivity when it comes to evaluating OURSELVES. We ALL live in our own little universe created in our brain. When we die that little universe dies with us. We share that little universe with the few people that we have some contact with or somehow intersect with our lives in some way. I do find it an interesting topic, especially at close to age 70. There are very few people in the world that SHARE a good part of my little universe......a brother or sister.....a spouse....children.....perhaps a few lifelong friends. But, as we age those people die and drop away and at some point there are very few that have any idea of someones life experiences and thinking and views or anything at all for that matter. Aging is an interesting experience. I would put the number of people that have any idea of my background and experiences and life at less than 10 at this point in time. I am not in this category....yet.....but I can see how the elderly often become very isolated.

    As to application to investing. That is ONE reason that I have the mutual funds in each portfolio. As a check against my INVESTING BIAS. It is also why I try to be VERY clinical and strictly tend to follow the academic research when it comes to investing style, which anyone reading this thread knows is Fundamental based LONG TERM INVESTING in proven, dividend paying names, with reinvesting of ALL dividends and capital gains.
     
  4. WXYZ

    WXYZ Active Member

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    HERE is a little article to get people started thinking about evaluating VALUE in picking LONG TERM investments. I DO believe value is an important aspect of any investment. I also believe MOMENTUM is just as important or perhaps even more important. I consider momentum or potential momentum as an aspect of value obviously. My approach with my BIG CAP, AMERICAN, DIVIDEND PAYING, ICONIC PRODUCT, MARKET LEADING, WORLD WIDE LEADER, companies is very much momentum oriented. For example AMAZON. When I first purchased AMAZON it was NOT a value in the typical stock evaluation sense. It was fairly or even highly priced for the moment. BUT, It was obvious that the company was on a rocket ship upward trajectory in terms of its business dominance and growth. The "momentum" of the company and their business was in a middle stage far from mature with much growth and profit potential to come in the years ahead. I like BIG stocks with great middle to long term momentum potential. In other words companies that are growing and have great future growth potential but are already dominating their business niche. This is where great management comes in, continued investment and growth in the business, dominating acceptance by the consumer, lack of significant competition, business buzz that is reality based and REAL.......companies that are in a position to MINT MONEY. This is the NUMBER ONE thing I look for in a LONG TERM investment. If I can find companies that combine that momentum potential, even if highly priced or fairly priced, that is what I want to hold as long as management has the ability to sustain that model and build that potential. Without getting into discussion at the moment, TESLA, is an example of a company that has that buzz but DOES NOT come close to meeting what I look for in a BIG CAP momentum company. Lets say they dominate the electric vehicle area, they seem to have momentum on their side but to me it is illusory. There is great capacity on the part of investors to fool themselves that companies like this that are MEDIA DARLINGS are good investments. In my opinion, companies like this have that media BUZZ but are ILLUSION. They suck in the dreamers and those that are always looking for the next big think, that big score.

    ANYWAY........

    "Are stocks a good value? The beginner's guide to finding out"

    https://www.usatoday.com/story/mone...-to-know-if-stocks-are-good-value/2806627002/
    How do you know if a stock is a good deal? Or the stock market?

    "The industry bombards us with complicated analysis and unreadable, unnecessarily intimidating jargon. How can you simplify it to what matters?

    The easiest way to fathom a stock’s (or the market’s) value is to think like you’re buying the whole business. What’s the price, and what will you get back in the long run?

    The price part is easy. Stock prices and broad indexes like the Standard & Poor's 500 are quoted widely.

    For the “get back” part, many use a figure called the price-to-earnings ratio, or P/E. It’s a stock or index price divided by its earnings per share. Some use the past 12 months’ earnings. Others use estimates for the next year (which I prefer, called forward P/Es). If a P/E is 12, you’re paying $12 for every dollar of earnings. Most pundits presume stocks are expensive when P/Es are high and cheap when they’re low. They think high P/E implies low return potential (and vice versa). But there is a better two-step way.

    First, flip it by dividing earnings by price. Or, just look up the stock’s P/E ratio at Google Finance and invert it (divide 1 by the P/E). Currently, the S&P 500’s forward P/E is 16. So divide 1 by 16, and you get 0.0625 or 6.25 percent. This is the S&P 500’s “earnings yield.” It’s what you would get each year after tax, forever, if the S&P 500 were a company, you owned it all – 100 percent – and earnings never grew.

    Second, to sense value, compare them to long-term bond interest rates. Ten-year U.S. Treasurys currently pay 2.73 percent. Stocks’ earnings yield is much higher, so a better long-term deal. BBB-rated corporate bonds – investment grade for the average public company, not too risky – yield 4.45 percent. That’s pretax, so in an average family with a 26 percent tax rate (state and federal) that’s 3.3 percent after you take out taxes.

    Stocks’ 6.25 percent is almost twice as high. So owning the S&P 500 earns a better return than lending to these same companies.

    As mentioned earlier, the earnings yield is your forever, after-tax return from all stocks if earnings never grow. But they do grow! Businesses adapt in the long term, capturing technological change and innovation. New inventions bring new sources of corporate earnings. Think about how many products use a simple microchip. Firm’s routinely dream up new ways to collide evolving technology with basic products and services. Medical progress is unending. It’s all future potential profit.

    When you own stocks, you own that future. When you lend by owning bonds, you don’t. You get fixed interest payments. If you need long-term growth to fund your long-term retirement, stocks are the surest way to get it. Earnings yields tell you this future is a bargain today.

    Of course, that says nothing about stock prices a month, six months or a year from now. Could be higher or lower. Those wiggles are the short-term and all about society’s varying sentiment toward owing volatile assets. This framework is just how to measure value in the long term and a great way to think about value. For more – and to learn more about different market segments – try some classic investment books. Andrew Tobias’ "The Only Investment Guide You’ll Ever Need" is quite handy. So is "The Wall Street Journal Guide to Understanding Money & Investing."

    (bold is my emphasis in this article)

    MY COMMENT

    In MY IDEAL investing world, I look for stocks that are good value when I purchase, BUT, more important to me, even if I pay a premium in the price today is the future, escalating, momentum (business model) of the company.

    I DO NOT often buy young and up and coming businesses. On the contrary, I usually look for companies that have turned the corner and are no longer in the start up or early stage, companies like NIKE, COSTCO, BOEING, GOOGLE, AMAZON, and the other stocks in my portfolio model that have the ability and marketing positioning to continue to kick ass as they continue to refine the business. When I lock in a company like this I will stick with it for the LONG TERM as long as it continues to perform.
     
    #244 WXYZ, Feb 11, 2019
    Last edited: Feb 11, 2019
  5. WXYZ

    WXYZ Active Member

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    TO CONTINUE the above discussion.......I believe you are seeing investors like WARREN BUFFETT following the same approach, for example his recent investments in APPLE. HERE is what I have been doing for a long long time:

    "An Evolve-or-Die Moment for the World's Great Investors

    http://www.fortune.com/longform/value-investing-warren-buffett-tech-stocks/

    (TO ME the key portions of this article)

    "Now, in front of roughly 40,000 shareholders and fans, he was intimating that we should become familiar with a new reality: The world was changing, and the tech companies that value investors used to haughtily dismiss were here to stay—and were immensely valuable.

    “The four largest companies today by market value do not need any net tangible assets,” he said. “They are not like AT&T, GM, or Exxon Mobil, requiring lots of capital to produce earnings. We have become an asset-light economy.” Buffett went on to say that Berkshire had erred by not buying Alphabet, parent of Google. He also discussed his position in Apple, which he began buying in early 2016. At roughly $50 billion, that Apple stake represents Buffett’s single largest holding—by a factor of two."......

    ........"There is a deep and important debate going on in the investment community, one with profound repercussions for both professional money managers and their clients. Some believe that Buffett is right—that we have become an asset-light economy and that value investors need to adapt to accommodate such changes. Noted value managers like Tom Gayner of Markel Corp. and Bill Nygren of Oakmark Funds, for instance, count companies like Amazon and Alphabet among their top holdings. The fact that these stocks often trade at above-market valuations—a factor that once scared away orthodox value investors—hasn’t deterred them, because the companies’ futures are so bright that they’re worth it.".........

    ......."What’s happening now is a debate about what the drivers of value are—of what constitutes value in the 21st-century economy—and what will drive both the economy and the market forward over the next generation.".......

    ......."These businesses, in fact, have much more in common with the durable, dominant consumer franchises of the postwar period. Their products and services are woven into the everyday fabric of the lives of billions of people. Thanks to daily usage and good, old-fashioned human habit, this interweaving will only deepen with the passage of time.

    Explaining his Apple investment to CNBC, Buffett recalled making such a connection while taking his great-grandchildren and their friends to Dairy Queen; they were so immersed in their iPhones that it was difficult to find out what kind of ice cream they wanted.

    “I didn’t go into Apple because it was a tech stock in the least,” Buffett said at this year’s annual meeting. “I went into Apple because … of the value of their ecosystem and how permanent that ecosystem could be.”.........

    ........"Long-term investors need to be thinking about such shifts, and they need to position their portfolios in accordance with them rather than against them. Darwin is often misunderstood, says Markel’s Gayner, who counts both Amazon and Alphabet among his holdings. “It’s not survival of the fittest, but those who are most adaptable to change, that make it through.”.......

    MY COMMENT:

    I GUESS I should differentiate this sort of "FUTURE MOMENTUM" or "VALUE MOMENTUM" from stock trading momentum. This is NOT a situation of short term trading based on the price momentum of a stock, it is an attempt to catch the LONG TERM marketing and business momentum of SUPERIOR, ICONIC companies with the potential to dominate their business for decades. AND this sort of investment is NOT limited to the TECH area. Companies like NIKE, COSTCO, BOEING, etc, etc, dominate their business area and have the potential to do so for decades in spite of their age and maturity as a business. Kind of like some of the old ICONIC consumer names....General Mills, Colgate, Proctor & Gamble, Coke, IBM, etc, etc, etc, these companies DOMINATED their market for decades and produced massive wealth for long term shareholders. They have ALL fallen away recently from the supremacy that they established in the 1950's and 1960's and 1970's....but I owned them all and for as long as I held them I made great money by BEING ALONG FOR THE RIDE for a long time. Of course NOW I no longer own these companies due to changing consumer taste for many and poor business management and planing for some like IBM.

    THE BOTTOM LINE, I am ALWAYS willing to pay current, full, value or even above value to have the ability to go along for the ride with a great company that will return escalating, superior returns for the LONG TERM.

    THAT is why I own these companies for the LONG TERM and have for some time in my very concentrated, non-diverse, portfolio:
    Alphabet Inc
    Amazon
    Apple
    Boeing
    Chevron
    Costco
    Home Depot
    Honeywell
    Johnson & Johnson
    Nike
    3M
     
    #245 WXYZ, Feb 11, 2019
    Last edited: Feb 11, 2019
  6. WXYZ

    WXYZ Active Member

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    HERE is some GREAT news for the economy in general. ATTITUDE is everything when it comes to consumer behavior......in my opinion....... and this will spill over to many businesses that deal with the general consumer in America.

    "Americans' Confidence in Their Finances Keeps Growing"

    https://news.gallup.com/poll/246602/americans-confidence-finances-keeps-growing.aspx

    (the highlights, emphasis in bold is mine)

    "WASHINGTON, D.C. -- Americans' optimism about their personal finances has climbed to levels not seen in more than 16 years, with 69% now saying they expect to be financially better off "at this time next year."

    The 69% saying they expect to be better off is only two percentage points below the all-time high of 71%, recorded in March 1998 at a time when the nation's economic boom was producing strong economic growth combined with the lowest inflation and unemployment rates in decades.".......

    ......."Fifty percent say they are better off today than they were a year ago. That 50% still represents a post-recession milestone -- the first time since 2007 that at least half of the public has said they are financially better off than a year ago."......

    ......."Ten years ago, as the Great Recession neared its end, the percentage saying their finances had improved from the previous year was at a record low of 23%. More than half the public, 54%, said they were worse off. Now, with unemployment below 1998 levels and the job market growing steadily, the number saying they are worse off than a year ago has dropped to 26%, the lowest level since October 2000.".....

    ........"Partisanship Plays a Role in Perceptions of Past and Future Finances
    Members of most major demographic groups are more likely in 2019 to say their financial situation has improved in the past year than to say they are worse off -- with Democrats the one major exception. By 37% to 32%, more Democrats say that compared with a year ago, they are worse off financially rather than better off. However, among some of the key groups that generally vote Democratic, a plurality or majority say they are better off.".......

    • "Sixty-two percent of those under 30 say they are better off; 25% say worse off.
    • Forty-five percent of women say they are better off; 29% say worse off.
    • Forty-five percent of those with annual household incomes of less than $40,000 say better off, 35% worse off.
    • Among liberals, 40% say better off, 31% worse off."......
    "Republicans are at the other end of the spectrum, with 68% saying they are better off, and only 10% saying worse off. Among groups that are more Republican than the national average, 66% of conservatives say they are better off, as do 57% of those with annual incomes of at least $100,000 and 56% of men."......

    ........"Bottom Line
    The United States brought in the new year with a partial government shutdown that stretched through most of January and a growing sense of pessimism about the nation's economy.

    But in spite of the negative turn in the public's views about the national economic picture, Americans are more upbeat now about their own finances than they have been in years.

    Economic conditions can take rapid turns, and lofty expectations can be dashed in the process. But for now, it appears that most Americans believe, at least for their own financial situations, that 2019 will be a good year."

    MY COMMENT:

    YES, good news for the general economy and many consumer type businesses in particular. ALTHOUGH, this sort of poll is subject to extreme media and news fluctuation.
     
  7. WXYZ

    WXYZ Active Member

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    Kind of a DULL day today...but at least made some positive money in all accounts due to the mixed market today with the SP500 being up along with the NASDAQ. Nike was my best performer today with a gain of 1.66%......$1.37 per share. I will TAKE ANY day that produces positive $ in my accounts.
     
  8. WXYZ

    WXYZ Active Member

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    Markets are ON FIRE today. Good to be a LONG TERM INVESTOR and capture ALL these random upward moves as they occur in spurts as is normal.

    As to "ON FIRE".......After I retired from the business world at age 49, I became a professional musician. I spent many years touring nationally and internationally. NO......I am NOT a big name frontman.....I was a sideman. One time in Iowa, we were playing a festival and someone came up to the bass player and said.....MAN, you are on fire. He got all puffed up with a big grin, feeling all BIG headed about his playing......TILL the guy said....NO....you are LITERALLY on fire. His amp was smoking.

    AND.......NO, I will not identify the type of music, band name, frontman, or anything else about it that would allow me to be identified.
     
  9. WXYZ

    WXYZ Active Member

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    Under the heading....WHEN WILL THEY LEARN:

    Illinois Gov. Pritzker's Rookie Mistake: Hiking Taxes On The Rich

    (bold is mine)


    "Illinois: The state of Illinois has struggled for years with its finances. As with other troubled states, it boils down to a simple formula: Too much spending, especially on government employee pensions, and not enough revenue. Democratic Gov. J.B. Pritzker thinks a tax hike on the rich will solve the problem. It won't.

    On Friday, the state revealed that its budget deficit was $400 million larger than expected, roughly $3.2 billion. That's not the worst of it. Illinois' public pension agency owes $234 billion, or about $18,281 per citizen, but has only funded about 40% of that amount. Pritzker, of course, blames former Gov. Bruce Rauner. But Illinois' fiscal ruin has been a group effort.

    Pritzker ran for office in 2018 promising more spending on schools, health care and jobs, while cutting taxes and imposing a new $15 minimum wage.

    Well, the state is spending a lot more, but tax cuts are now off the agenda. Instead, Pritzker will propose to double taxes paid by those with income over $225,000, the so-called rich, to 7.65% from 3.75% now.

    Sorry, governor, but a new report from Moody's Investors Service says that's a rookie move. Moody's bluntly predicts Pritzker's higher taxes will lead to even more high-income people joining the mass exodus to other states, making the state's fiscal crunch even worse.

    Tax Hikes On The Rich
    As Moody's noted, "the population loss and relatively sluggish employment trends suggest a degree of economic vulnerability that poses a conundrum: revenue growth from existing sources will be too tepid to offset escalating fixed costs, while new taxes could threaten to increase the outflow of residents."

    In a recent piece, IBD focused on New York's ills, which, no surprise, are similar to Illinois' — high taxes, a huge out-migration of wealthy taxpayers, massive pension liabilities, chronic deficits. But, as we noted, New York Gov. Andrew Cuomo wisely ruled out raising taxes on the rich. "God forbid if the rich leave," he said.

    Illinois: The Wealthy Leave
    As Moody's noted, Illinois lost some 544,541 residents to other states from 2013 to 2018, or 4.2% of its 2013 population. The people leaving represent wealth, skills, education, know-how and, often, local roots. Illinois is watching the only thing that can save it from bankruptcy — its most talented people — flee to other states where taxes, corruption and incompetence aren't so bad.

    Worse, the state Senate approved a hike in the minimum wage to $15 an hour by 2025. That will lead to thousands of low-skilled, untrained workers losing jobs. A minimum wage, after all, is a tax on hiring low-wage workers.

    Pritzker's call to raise taxes on successful residents and on those at the bottom is a huge unforced error, one that shows his lack of basic economic understanding."

    MY COMMENT:

    Typical and unfortunately IDIOTIC at the same time. Regardless of party the temptation to raise taxes is the number one option that the politicians grab. NEVER controlling spending. Those of us with enough memory and enough years KNOW that raising taxes is a LOSER. Whether Kennedy, Regan, or now Trump, CUTTING taxes and especially cutting the CAPITAL GAINS RATE, is the one sure way to stimulate the economy. AND, I mean the REAL economy, not government spending on the beurocracy and their pet projects. This is one reason when I got to the point that I could see that I could retire at age 49, I did it. Taxes and government fees were eating up at least 50% of everything I earned. HERE is what I paid as a business owner back than and the reason I got out. Of course, when I left the amount that government got from my business went to........ZERO. Realistic tax policy stimulates business, jobs, the economy, etc, etc.

    Social Security and Medicare (self employed) 15%
    Income Tax 20-30%
    B&O Tax (state, on GROSS business income)
    B&O tax (city and county 3% on GROSS BUSINESS INCOME)
    L&I worker premiums on employees
    FUTA (Federal unemployment)
    Sales Tax
    Property tax on business property and home
    Personal property tax on business property
     
  10. emmett kelly

    emmett kelly Well-Known Member

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    in that case from now on this is who i will imagine you really are. makes for a more enjoyable dialogue.

     
    Three Eyes likes this.
  11. WXYZ

    WXYZ Active Member

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    NO....not me. AND.....not the bass player I reference playing with above. BUMMER!
     
  12. WXYZ

    WXYZ Active Member

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    SO........here we are at the moment a little over 800 points from the ALL TIME HIGH on the DOW. Less than 4% from where we are right now. Think back to what was being said in the MEDIA and all over the place in December. Think back to all the talk about interest rates in October, November, December. Think back to what was being fear mongered about China over the past months. Etc, etc, etc. NO......YES,..... NO......substance to ANY of it. Simply short term trader talk to attempt to influence and move markets for profit, simply media fear mongering for clicks and eyeballs, simply political STUFF to push agenda, simply delusion on the part of investors and others that probably are invested OVER their risk tolerance, etc, etc, etc. The markets RIGHT NOW, in my opinion reflect the REAL fundamentals and REALITY. Something that actually happens once in a while....

    On another topic.....HERE are the holdings of Warren Buffett. Not advocating for any of these companies, there are many that I would personally NOT touch at this time, like Wells Fargo, Kraft, GM, etc.

    Warren Buffett’s Top Stocks for 2019

    https://247wallst.com/investing/2019/02/14/warren-buffetts-top-stocks-for-2019/

    "American Express Co. (NYSE: AXP) was the same 151.6 million share stake it has been for years.

    Apple Inc. (NASDAQ: AAPL) was listed as 249.59 million shares in the 13F filing, down marginally from the 252.47 million shares in September (barring any confidential information).

    Bank of America Corp. (NYSE: BAC) was 896.17 million shares at the end of December, up by roughly 19 million shares.

    Coca-Cola Co. (NYSE: KO) was the same 400 million shares, another stake that has not changed in many years.

    Wells Fargo & Co. (NYSE: WFC) was listed as 426.77 million shares, down from the September 2018 stake of 442.36 million shares (and down from 452.0 million in June and from 456.5 million prior to that).

    Kraft Heinz Co. (NASDAQ: KHC) is also a continued massive holding that is outside of the normal book-keeping in the largest public equity holdings. Berkshire Hathaway owned 325.63 million shares at the end of December.

    American Airlines Group Inc. (NASDAQ: AAL) was the same stake of 43.7 million shares, but that was down from 44.7 million shares earlier in 2018.

    Bank of New York Mellon Corp. (NYSE: BK) increased to 80.94 million shares at the end of December, up from 77.85 million shares at the end of September and from 64.8 million shares in June.

    DaVita Inc. (NYSE: DVA) was a stake of 38.565 million shares, same as in September.

    Delta Air Lines Inc. (NYSE: DAL) was the same stake of 65.54 million shares as in September, but that had been up from 63.67 million shares in June and even higher than it had been in March.

    General Motors Co. (NYSE: GM) was a larger stake of 72.27 million shares in December, up from 52.46 million shares in September and from 51.39 million shares in June.

    Goldman Sachs Group Inc. (NYSE: GS) was the same 18.35 million shares as it was at the end of September 2018 but handily above the levels seen earlier in 2018.

    JPMorgan Chase & Co. (NYSE: JPM) was listed as a new stake in September, but at the end of December it was 50.12 million shares, versus a September stake of 35.66 million shares.

    Oracle Corp. (NYSE: ORCL) had been a new stake of 41.4 million shares as of the end of September, but the December filing does not include Oracle in the 13 filing at all.

    Phillips 66 (NYSE: PSX) was down to 11.9 million shares at the end of 2018, lower than the 15.43 million shares in September and far lower than the 34.7 million shares when Buffett decided to get out from under the 10% SEC holding threshold.

    PNC Financial Services Group Inc. (NYSE: PNC) increased to 8.26 million shares in December from 6.09 million in September.

    RedHat Inc. (NYSE: RHT) was listed as a new stake of 4.18 million shares at the end of 2018, but this may be an arbitrage play on the IBM merger spread. Buffett and his team have made similar merger-arb transactions in the past.

    Southwest Airlines Co. (NYSE: LUV) was 54.85 million shares at the end of 2018, down from 56.05 million shares in September and 56.54 million shares at the end of June.

    StoneCo Ltd. (NASDAQ: STNE), a fintech company, is a new stake of about 14.17 million shares as of the end of 2018.

    Suncor Energy Inc. (NYSE: SU) was a new stake of 10.76 million shares.

    Travelers Companies Inc. (NYSE: TRV) was increased to 5.96 million shares at the end of December, after it had been a new stake of 3.54 million shares at the end of September.

    United Continental Holdings Inc. (NYSE: UAL) was 21.94 million shares, down from the 25.98 million shares in September, and down from 26.684 million shares in June and 27.7 million shares in March.

    U.S. Bancorp (NYSE: USB) was 129.31 million shares at the end of December, up from 124.92 million shares in September and 100.69 million shares at the end of June."
     
    #252 WXYZ, Feb 15, 2019
    Last edited: Feb 15, 2019
  13. TomB16

    TomB16 Active Member

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    I love Warren Buffett and am eternally grateful to him for sharing his wisdom with the world. We have received so much benefit from his teachings, he is a hero to me. I feel the same about Jack Bogle.

    To be honest, I don't follow his portfolio all that closely. His buying a big stake in IBM was when the knowledge umbilical between he and I was cut. That has turned out to be a good thing.

    I know the majority of people hate REITs with an irrational passion but I like them a lot. We hold several REITs and two have been at the core of our portfolio for over a decade.

    By the way, I'm extremely fussy in the type of REIT we own. I have no interest in certain real estate market segments that I believe are going away in the next 20~30 years.

    People hating on REITs is why I own them. I like financials too but they are so high priced I only own one. I just haven't found as much value in the stocks as I have in the companies.

    Energy companies are great, I own two, but so many of them have been grossly mismanaged that it's tough find a good management team. As the industry tightens up, the clowns will be shaken from the tree. Still, a well run energy company will provide solid yields over time.
     
  14. TomB16

    TomB16 Active Member

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    Back to REITs....

    We have a small stake in a shopping mall REIT that is a piece of garbage. Everyone, including REIT management, knows shopping malls are going away on the long term.

    Management has presented plans to redevelop malls into little micro-economies with hi-rise condos and converting the mall itself into mixed use of retail and social space. This makes a lot of practical sense but I've done a chin scratch estimate that indicates it is not going to return invested money as well as a bare dirt site.

    None the less, we bought this REIT in 2011 and it has distributed more than our initial stake. Of course, we have never DIRPed it. It could go bankrupt now and we would be out nothing. It continues to have strong earnings, though. I expect it will still be around in 20 years. Recent hits to the stock price have it distributing over 12% with enough earnings to easily cover.

    I don't recommend others take this path, nor do I discourage it. There are well run companies in withering sectors that have solid earnings and easily have an ability for full ROI in a short period of time.

    I keep my eye peeled for similar opportunities in the oil sector. Oil will be dying for the next 75 years. There is still a ton of money to be made selling oil.
     
  15. emmett kelly

    emmett kelly Well-Known Member

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    In the four mutual funds that I'm holding and of the top 10 stocks in each of those funds the only stocks I share with Mr. Buffett are AXP, AAPL and LUV.
     
  16. TomB16

    TomB16 Active Member

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    Emmett, are you suggesting you aren't captivated by the current Berkshire Hathaway portfolio either?

    I have considered holding BRK based on the epic historic trajectory but have resisted based on uncertainty regarding the post Buffett direction.
     
  17. emmett kelly

    emmett kelly Well-Known Member

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    I wouldn't go so far as to say that but the list piqued my curiosity so I did a quick review of my holdings. I'm sitting in an office cubicle in Long Beach. Would imagine Mr. Buffett is on a yacht in a remote part of the world somewhere beckoning young, vivacious, scantily clad vixens to bring him drinks and other services.
     
  18. WXYZ

    WXYZ Active Member

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    Another GOOD and positive week for stocks and those that invest in them. We are now less than 4% from the ALL TIME HIGH in the DOW. NOTHING negative on the horizon at the moment.

    DOW year to date +10.96%
    SP500 year to date +10,72%
     
  19. WXYZ

    WXYZ Active Member

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    FILE this story under:

    NEW MATH or
    WEEKEND FUN or
    WHATEVER

    ANYWAY, I dont know why this story strikes me as really funny, but it does. Perhaps it is the joining together of FLAMING CONSERVATIVE site Breitbart and FLAMING PROGRESSIVE De Blasio together in spirit on this issue. the last line is certainly very funny.

    Nolte: Mayor Bill De Blasio Blasts Ocasio-Cortez for Killing Amazon Deal

    https://www.breitbart.com/politics/...sio-blasts-ocasio-cortez-killing-amazon-deal/

    (bold is mine)

    "Mayor Bill de Blasio (D-NY) ripped into Rep. Alexandria Ocasio-Cortez (D-NY) for her role in killing the deal to bring Amazon to Queens.
    During an appearance on WNYC radio this week, the mayor said, “As a progressive my entire life — and I ain’t changing — I’ll take on any progressive anywhere that thinks it’s a good idea to lose jobs and revenue because I think that’s out of touch with what working people want.”

    “I came up watching the mistakes of progressives of the past, unfortunately what happened in this city when it almost went to bankruptcy in the 1970s,” a furious de Blasio added. “I saw all the times progressives did not show people effective governance and all the times progressives made the kinds of mistakes that alienated working people.”

    “Working people are very smart and very discerning. They want jobs, they want revenue, they want the kinds of things that government can do for them,” he said. “They understand they have to be paid for.”

    This week, Ocasio-Cortez cheered the news that Amazon pulled out of a deal that promised 25,000 high-paying jobs for her constituents and at least $25 billion in additional tax revenue over ten years.

    “Anything is possible,” she tweeted.“Today was a day a group of dedicated, everyday New Yorkers & their neighbors defeated Amazon’s corporate greed, its worker exploitation, and the power of the richest man in the world.”

    The only problem with that is that she later proved she had no concept of how the deal was set up. “We were subsidizing those jobs,” she told reporters, adding that if the state/city was willing to “give away $3 billion for this deal,” those investments can, instead, be made in hiring teachers and fixing the subway.

    Here’s the full quote:

    So I firmly believe that if we want to take that $3 billion dollars that we were willing to give to Amazon and invest it in our local community, we can do that. We can make those jobs. We can make 25,000 jobs. But we don’t have to give away and allow our subway system to crumble so that Amazon essentially owns a part of New York City. We can create 25,000 jobs with Mom-and-Pops; we can create 25,000 jobs with companies that are willing to come to the table, but we should not be giving away our infrastructure, our subway system, our schools, our teachers’ salaries, our firefighters’ budgets, to a company that has not shown good faith to New Yorkers. And we can ask for more because we deserve more.

    Except that is not at all how the deal was structured. There was no giveaway. The $3 billion was a tax cut, was New York allowing Amazon to keep its own money. In other words, if Amazon owed $23 billion in taxes, the company would only pay $20 billion.

    Now, as I argued on Friday, there is a case to be made against this kind of crony capitalism, these carveouts where the government picks winners and losers. I am not a big fan of the gentrification that would have certainly come with Amazon’s massive campus on Long Island City, Queens. But I am also willing to admit I’m a middle-aged fuddy-duddy who hates change.

    But that this deal overall was a good one for New York is not in dispute. There is also no doubt the people of New York, including Ocasio-Cortez’s own constituents in the Queens area that would have been most affected by it, wanted the deal. But she blew it…

    And when a Bill de Blasio is complaining about someone being too far to the left, that is really something.


    In her defense, though, it could just be that she’s an idiot.
    "

    MY COMMENT:

    That is one great closing line regardless of politics. As an AMAZON, long time shareholder, I thought this decision to locate in New York was absolutely DUMB. NOT a good way to create shareholder value, in my opinion.

     
  20. WXYZ

    WXYZ Active Member

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    THOUGHT this was an interesting "little" general article on the state of AI and machine learning in stock trading and other aspects of investing. We know that the vast majority of even professionals can NOT beat the SP500 over a period of time. It will be interesting to see if the machines can do it. Just off the cuff.....I doubt it. I suspect that the majority of machine trading firms will still either LAG the SP500 over the LONG TERM or at best will just match it.

    "How elite investors use artificial intelligence and machine learning to gain an edge"

    https://www.cnn.com/2019/02/17/inve...ligence-investors-machine-learning/index.html

    MY COMMENT:

    "Qi cautioned that machines are "only as smart as the data you're feeding it."". As long as there is ANY human element there will NEVER be freedom from human emotion, error, ego, hubris, etc, etc, etc.
     

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