The Long Term Investor

Dave.....It is NOT......"my Coinbase".....LOL. I have not decided whether or not to do this trade....yet. If I do make this....RARE.....trade....I will have a profit target......and.....I WILL stick with it and take that profit if it happens. I doubt that I would hold any portion of it as a long term holding.

I WILL mention.....that I do NOT invest in CRYPTO......ever. I do not consider it a REAL entity......it is illusion. Yes....the entire concept of money might be illusion.....but CRYPTO is another level of illusion. Just my personal opinion......of course

I too have my usual rules of long term investing and.....NOT....trading. Once in a while I allow myself to break my rules. If I do happen to do this trade....I will post it as usual. In fact....if I decide to NOT do it....I will also post that. As I said I have not made any decision....yet.....I am very cautious about this sort of move since it is......NOT....in line with what I normally do.

 

Agree completely Zukodany. There is ABSOLUTELY NO.....take it or leave it time for an investment.

NOW....Crypto or NFT.....total illusion in my opinion. I just do not see it

 

Amazon, Microsoft, Apple, Google, and the one I will not own....Facebook.

 

Dave.........you know I own some.....ACTUAL....income annuities. They make up my retirement income along with Social Security and allow me to have my stock market money fully invested......with no need to use it....for the rest of my life.

PERSONALLY.....I see a HUGE difference between "investors" and "traders".......but that topic could take up Hundreds of pages on a new thread. Too much for me to mess with or get into........an AGE OLD ARGUMENT....on message boards

 

Emmett.......you stole my topic on Ford and Mexico. I heard this while driving and decided to post it later. YES.......the opening salvo in the FLEEING of America by the big corporations. Globalism.......2.0...or is that 3.0 or 4.0 or even 10.0.

Union warns Ohio workers that Ford plans to move new vehicle construction to Mexico

https://thehill.com/policy/transpor...o-workers-that-ford-plans-to-move-new-vehicle

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

"United Auto Workers (UAW) warned Ford employees in Ohio that the company plans to move the construction of a new vehicle to Mexico, according to a letter made public this week.

UAW Vice President Gerald Kariem addressed a letter to Ford workers in Avon Lake, Ohio, in which he accused the automaker of violating a contract agreement with the union with its plans to build a next-generation vehicle in Mexico instead of the Ohio Assembly Plant (OHAP).

The letter, sent with the union’s letterhead, cited a 2019 four-year contract deal in which Ford committed $900 million for the assembly plant in Avon Lake, including adding production for a next-generation product in 2023.

The UAW said the agreement would secure the assembly plant's “employment well into the foreseeable future” but that Ford “has decided it will not honor its promise.”

“Ford management expects us to just hang our heads and accept the decision,” Kariem wrote in the letter dated Friday. “But let me be clear, we are making a different choice.”

“We 100% reject the company’s decision to put corporate greed and more potential profits over American jobs and the future of our members,” he continued. “We expect the company to honor its contractual commitments to this membership and when it fails to do so we will take action.”

Kariem wrote that the union has made data requests for an explanation of the decision, but the automaker has only given “strategically limited information.”

“We are intensely exploring our options at this time,” he wrote in the letter that copied UAW President Rory Gamble and the union’s two top lawyers.

In response to UAW’s letter, Ford plant manager Jason Moore released a letter to Avon Lake workers obtained by The Hill, noting that the 2019 agreement included a “reference to a $900 million investment and a new product for OHAP.”

“While conditions upon which the 2019 Administrative Letter were based have changed, the Company is investing in the plant and increasing production of Super Duty trucks at OHAP," Moore wrote.

The letter continued saying that the company has invested more than $185 million into the Avon Lake plant and retained 100 jobs there since 2019.

Ford had announced in November that it intends to build another electric vehicle in Cuautitlan, Mexico, in addition to the Mustang Mach-E, Reuters reported.

Kelli Felker, Ford global manufacturing and communications manager, declined to tell the Detroit Free Press whether Ford intends to keep its commitment to the Ohio plant, saying, "We are always looking at our options.”

"Ford employs more hourly workers in the U.S. than any other automaker, assembles more vehicles in the U.S. than any other automaker, and Ford chooses to invest in America more than any other automaker," she said in a statement obtained by The Hill.

"We remain committed to investing $6 billion in our U.S. plants and creating and retaining 8,500 jobs in America during this four-year UAW contract," the statement said. "We are invested in Ohio Assembly Plant and our dedicated workforce there.""

MY COMMENT

"We are always looking at our options".......I bet they are. The timing of this little decision......now that we have a new government.......is delicious. YES.....we are moving back to the future. Seems like I remember a time not too long ago when this sort of stuff was the NORM. Plants were moving out of the country..........employment was in the STAGNANT TOILET.

THIS is EXACTLY why I have NO FEAR or inflation. Future employment issues and a LACK of wage pressure is not going to allow inflation to be an issue here. It is OBVIOUS that we are going to see......many companies......moving out of the country with their manufacturing......AND.....their corporate HQ's once the new tax law is passed. You would have to be a MORON to not take advantage of the situation if you were a company. You can pay actual wages here in the USA of....$15 as our new minimum wage.....and above....or.....you can pay $1.50 to $2.00 in Mexico and even less in India, Asia, Africa, South America, etc, etc.

I have had a number of discussions with younger white collar corporate workers lately about their job insecurity. The can not see it.....yet.....they are all working from home and planing to continue when the pandemic is over. MY OPINION......they are out of their minds.....living in LA LA Land.........they are not going to have a job in the future.

They have now shown their corporate masters that it is very possible to run a big company with workers working from home.....even managers.....working from home. It is OBVIOUS that the next step will be to fill those American jobs with FOREIGN WORKERS working from home.......in other countries. A win win for the company.......no American benefits to pay.....no Social Security........no labor regulations to worry about.....no workers comp premiums.....an unlimited pool of cheap labor. Of course NONE of them will be actual employees....they will......ALL..... work for contract worker brokers.

As an investor in BIG CAP AMERICAN companies........the glory years of productivity and profits are stretching as far into the future as anyone can see. For American workers.......BUMMER. Not my problem.......right?

 

AND.......OH MY GOD.....yields have gone up again. Ok......what else is new. We are at historic lows.....other than negative rates....there is nowhere to really go but UP. No need to re-hash my views from past posts.

I find it interesting that I am now seeing headlines SCREAMING........."Home Sales Still Strong In Spite Of The High Mortgage Rates". Yeah right.....the rates for a 30 year are up to what......3.25% today. I saw this headline in the Washington Post....."Mortgage rates keep climbing, hit nine-month high".......when the 30 year fixed rate hit 3.09%. This is simply......self absorbed foolishness.

Right now we have HISTORIC.....LOW home mortgage rates. In my entire home buying life.......yes......we have bought 10 homes starting in 1974 and ending with the last purchase in 2019. Of course....we are now CASH buyers. We NEVER saw rates anywhere near as low as now. In fact........NO BUYER. in the past....ever even IMAGINED.....in their wildest dreams..... that rates could ever be as low as they are now.

 

I am SICK of talk about rates and yields....but...for those that care....here is a little article on the topic.

The Fed is dovish but bond yields are soaring. What gives?

https://www.marketwatch.com/story/t...-soaring-what-gives-11616089693?siteid=yhoof2

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

"Only a day after analysts had hailed the victory of the Federal Reserve over traders doubting the central bank’s pledge to keep monetary policy easy for an extended period, bond yields rose sharply on Thursday.

The 10-year Treasury note yield TMUBMUSD10Y, 1.713% was up nearly 10 basis points to around 1.74%, around its highest level since January 2020. Meanwhile, the 30-year bond yield was knocking on the door of 2.5%, near its loftiest level since mid-2019. Bond prices move inversely to yields.

Investors are now scrambling to understand what has prompted the renewed volatility in a Treasury market that appeared to have calmed down after Wednesday’s Fed meeting.

Here are some of the theories being thrown around:

Average Inflation Targeting
After the meeting, market participants said Powell’s dovish messaging was, in fact, responsible for higher long-term yields.

At the postmeeting news-conference, Powell underlined the central bank would stick to its new framework of average inflation targeting, which would in theory only see the central bank contemplate less accommodative policy if inflation managed a sustained overshoot of 2%.

By confirming the Fed’s willingness to stand pat, even if inflation saw a temporary surge beyond 2%, investors may be raising the probability the economy will run hot in the next few years without having to worry about the central bank pulling away the market’s punchbowl. In that scenario, long-term bond yields would have little protection against the risk of an inflationary surge.

“This new inflation framework is destined for a steeper yield curve,” said Matthew Miskin, co-chief investment strategist at John Hancock Investment Management, in an interview, referring to the spread between short-term and long-term yields.

Yet markets were sending mixed messages. Break-even rates that show inflation expectations among holders of Treasury inflation-protected securities indicated investors did not see price pressures persisting over the longer term.

The 5-year break-even rate was around 30 basis points higher than the 10-year break-even rate.

“The market is pricing in transitory inflation,” said Frank Rybinski, chief macro strategist at Aegon Asset Management, in an interview.

Credibility
Amid the Treasury-market selloff, the sharpest rises were seen among medium-term maturities like the 5-year note TMUBMUSD05Y, 0.862% and 7-year note. TMUBMUSD07Y, 1.341%

As a proxy for interest-rate expectations over the next few years, their surge could also have suggested investors may be doubting the central bank’s pledge to keep policy accommodative for a sustained stretch of time.

After all, analysts remarked there was only so much the central bank could do to fight investors’ tendency to look ahead.

Given the enormous uncertainty around inflation and economic growth as the economy fully reopens and stimulus makes its way into households’ pockets, it was difficult to know where Fed policy would be in a year’s time when the growth and inflation outlook was just as murky.

“This cycle is so much, so fast, and so soon. A lot of things are getting distorted,” said Rybinski.

Big in Japan?
Yet for all the speculation around whether the Fed was the trigger for the Treasury selloff on Thursday, some analysts were looking abroad for answers.


“Global central banks came out overnight with a more hawkish stance,” said Miskin.

The Bank of Japan during its two-day meeting was looking to adjust its yield-curve control policy where it keeps long-term interest rates capped but allows them to trade in a tight range, according to a report from Japanese financial newspaper Nikkei.

The BOJ’s measures would allow the 10-year Japanese government bond yield to move in a range between 0.25% and negative 0.25%, compared with the current range of 0.20% and negative 0.20%.

BofA Global strategists said the tweak would allow “further back-end steepening of the [Japanese government bond] curve, alleviating some of the pressure on financial institutions, and making the BoJ’s easing program more sustainable in the long run.

Soon after the report, the 10-year Japanese government bond yield TMBMKJP-10Y, 0.106% jumped, moving from an intraday low of 0.085% to a high of 0.122%. The 10-year has since steadied at 0.107%, according to Tradeweb data.

As an anchor of bond yields across the world, analysts said rising rates in Japan can be amplified into broader weakness in Europe and U.S. bonds as Japanese investors reassess the gains from holding domestic debt over their overseas peers.

Meanwhile, the jump in Treasury yields was blamed for renewed pressure on growth-oriented stocks, which stand to suffer most from higher rates due to lofty valuations. The tech-heavy Nasdaq Composite COMP slumped more than 1% in Thursday trade, while the more cyclically oriented Dow Jones Industrial Average DJIA traded in record territory and the S&P 500 SPX saw a modest pullback."

MY COMMENT

NOTICE that is is all......."theories"......no one knows why the rates are going up. It is just more BLATHER by experts that actually dont know....as usual.

I have a basic question for ALL the experts:

Why do you think Growth Stocks are going to suffer.......THE MOST....... from rising rates......especially the BIG CAP companies that get hit when the rates make a microscopic jump?

These companies have EXISTED for their ENTIRE COMPANY HISTORY during times with significantly higher rates than now.

My view....we are seeing shorts trying to manipulate the treasury yields for short term trading profits. The media.....are their knowing or unknowing.....STOOGES. It is simply a SYMBIOTIC RELATIONSHIP.....the shorts and traders use the media to put out their line to the public.......and.....the media plays their part to be able to make money from.......clicks and eyeballs......on their content every day based on the fear mongering.

BUT....my view does not count....right or wrong. The one place that my view matters is OVER THE LONG TERM. NONE of this short term stuff and manipulation has any long term staying power. Over the long term it is all about business success and fundamentals.

 

ACTUALLY.....EVERYTHING....in this thread for over 200 pages boils down to.......I will just sit and not do anything.......Time is on my side......as is history.

 

In six months or a year or two years........I will (hopefully) still be posting the short term drama and psycho-babble stuff every day for something to do. BUT......in REALITY.....I will STILL be doing the same old long term investing that has been happening in my family going back for over 70+ years.

Dont let the SHORT TERM become an obsession........I dont. Just because I post.........this day to day "stuff".....does not mean any long term investor has to care about it.....AT ALL. ALL THAT COUNTS......is.......what happens over time periods of 3-7 years....... with the markets and investments moving forward. SO......

AS USUAL

I am once again posting my PORTFOLIO MODEL. My initial criteria to start the process to consider a business are.......BIG CAP, AMERICAN, DIVIDEND PAYING, GREAT MANAGEMENT, ICONIC PRODUCT, WORLD WIDE LEADER IN THEIR FIELD, LONG TERM HORIZON, etc, etc, etc.

PORTFOLIO MODEL

"Here is my "PORTFOLIO MODEL" for all accounts managed which is the basis for MUCH of my discussion in this thread. I am re-posting this since I often talk in this thread about my portfolio model. My custom in the past on this sort of thread was to re-post my portfolio model every once in a while since I will tend to talk about it once in a while. I "manage" six portfolios for various family including a trust. ALL are set up in this fashion. If I was starting this portfolio today, lets say with $200,000. I would put half the money into the stock side of the portfolio, with an equal amount going into each stock. The other half of the money would go into the fund side of the portfolio, with an equal amount going into each fund. As is my long time custom, I would than let the portfolio run as it wished with NO re-balancing, in other words, I would let the winners run. Over the LONG TERM of investing in this style (at least in my actual portfolios), the stock side seems to reach and settle in at about 55% of the total portfolio and the fund side at about 45% of the total portfolio over time. That is a GOOD THING since it tells me that my stock picks are generally beating the funds over the longer term. AND....since the funds in the account generally meet or beat the SP500, that is a VERY good thing.

As mentioned in a post in this thread, I include the funds in the portfolio as a counter-balance to my investing BIAS and stock picking BIAS and to add a top active management fund that often beats the SP500 (Fidelity Contra Fund) and a SP500 Index Fund to get broad exposure to the best 500 companies in AMERICAN business and economy. The funds also give me broad diversification as a counter-balance to my very concentrated 12 stock portfolio. At the same time the funds double and triple up on my individual stock holdings............that I consider the BEST individual businesses in the WORLD.

STOCKS:

Alphabet Inc
Amazon
Apple
Costco
Home Depot
Honeywell
Nike
Microsoft
Proctor & Gamble
Tesla
Nvidia
Snow (100 shares, a rare, long term, speculative holding)

MUTUAL FUNDS:

SP500 Index Fund
Fidelity Contra Fund

CAUTION: This is a moderate aggressive to aggressive portfolio on the stock side with the small concentration of stocks and the mix of stocks that I hold and with the concentration of big name tech stocks. Especially for my age group. (71). So for anyone considering this sort of portfolio, be careful and consider your risk tolerance and where you are in your life and financial needs. I am able to do this sort of portfolio since my stock market account is NOT needed for my retirement income AND I have a fairly HIGH RISK TOLERANCE. In addition I am a fully invested, all the time, LONG TERM investor. (LONG TERM meaning many years, 5, 10, 20, years or more)"

MY COMMENT

This portfolio is HIGHLY CONCENTRATED on the big cap side of things. OBVIOUSLY between the funds and my twelve stock holdings there is MUCH doubling and tripling up on the stocks. THAT is INTENTIONAL. I strongly subscribe to the view of Buffett and some others that TOO MUCH diversification kills returns. I do NOT believe in the current diversification FAD that most people seem to now follow.......or think they are following. I DO NOT do bonds and think the current level of bonds held by younger investors.....those under age 50.....is extremely foolish.I DO NOT do market timing or Technical Analysis.

 

Just to get away from the short term investing porn.

Six ways a long-term outlook could boost your investment portfolio

https://www.themoneypages.com/investments/six-ways-long-term-outlook-boost-investment-portfolio/

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

"Stock markets have a habit of fluctuating from month-to-month – even day-to-day. But the long-term picture can be very different. Here are six reasons playing the long game can pay off

The end of ISA season is a great time to set goals for the upcoming financial year.

“For many of us, it’s natural to want to get rich quickly, however it’s important to remember that investing is an inherently long-term game,” says Adrian Lowcock, head of personal investing at Willis Owen.

“When you invest in a company, you are becoming an owner of that business, and sharing in its successes and profits, but you can also expect market downturns.

“When you have a long-term strategy, short-term fluctuations shouldn’t weigh too heavily on your overall returns.”

Below, Lowcock outlines the benefits of a long-term investing outlook.

Less emotional

Taking a long-term perspective can make you less emotional. With technology has come the ability to look at our investments around the clock, but you don’t have to worry about making a profit or loss in the next day or week, and potentially lose sleep over the outcome.

Emotions can lead us to make snap decisions that can impact our individual goals. Investing for the long run means you don’t need to worry about the daily movements in share prices and instead can focus on the bigger picture.

More time efficient

Trying to predict the short-term movements of share prices is hard work. Traders often spend hours poring over charts to identify which stock is going to rally in the short-term and which isn’t.

Day trading can work for some of us, but it’s rarely the best way to make money. Many investors rush to buy shares when it falls in price, but more often than not, new information has come out which changes the outlook for the company.

Good investment ideas are not as common as one might think, but once you have found them most of the groundwork is done.

You can start small

You can start investing with small amounts of money by investing in a fund and topping up your investments each month to build your portfolio over time.

The trick is to think about what you are saving for over the next ten or fifteen years and implementing a strategy to achieve your goals.

Reduces the risk of loss

One of the main issues people are concerned about is that they might lose their money. The reality is the value of an investment may fall and you can get back less than you invested.

However, if you hold a diversified portfolio, then the likelihood of losing money falls the longer you remain invested. Historically, markets have rallied to high levels, although past performance is not a guide to the future.

Cut your costs

Long-term investing can also help you cut costs. Trading shares can be expensive as each time you buy or sell a share there are transaction costs and stamp duty rates that impact the long-term returns you can expect.

By trading too frequently you are generating fees for your stockbroker and therefore profit for someone else. Whereas a long-term outlook can help you manage the overall cost of investing.

Make the most of compounding

It is believed Albert Einstein once described compounding as the eighth wonder of the world.

Compounding allows you to earn money on your savings and when you reinvest that you earn even more money on it.

For example, £1,000 invested, excluding charges, growing at 5% per annum will deliver £50 each year. Over 30 years that would be £1,500.

If that money is reinvested each year instead, the return is £3,322*. That’s more than twice the return on the same investment from compounding alone.

“There are many options for investors, but we believe taking a long-term approach is likely to be the simplest and most successful approach for generating above-inflation returns.”"

MY COMMENT

YES......peace and quiet. It is nice to be away from the mania and noise of the short term for this post. The simplicity of long term investing.