The Long Term Investor

Yeah......even a small garden tractor....has to be respected. Even after 12 years of using our tractor, shredder, front loader, garden tractors.....I NEVER got complacent. NEVER use equipment without having your cell phone on you.

Invest in a good pair of professional quality.....ear muffs. Hearing protection is important....and....they will save your head and ears from scrape injury when you go under a tree or into brush. Another tip....even in the summer....wear a hat, eye protection and tough long sleeve shirt and jeans if you are mowing under trees and brush. Doing this saved me a lot of small injuries....especially eye injury.

 

LOL....I had to come back and post regarding the above. We had a large "tank" on our property. A pond for those not in Texas. The banks were very steep. We got to where we would mow that with the garden tractor at some pretty extreme angles. Once in a while it would slide down into the mud and water and we would have to pull it out with the big tractor.

I think that tip over accidents either to the side or over backwards has to be among the major causes of injury and death with all sorts of tractors. In our area, many people, us included, filled the wheels of the big tractors with water to increase the weight down low and help prevent tip over accidents and to add extra weight on the back to balance the front loader when lifting heavy loads. Add a little anti-freeze in cold climates so your wheels dont freeze.

This thread is now going to evolve into....The Tractor Thread.

 

The Lawn Trim Investor....love it.

 

A nice GREEN day for me today. My ONLY down holdings were HON and PG. I got beat by the SP500 today....but all in all a great end to the week.

Stocks and funds made an EPIC comeback today to end the week. The SP500 managed to.....come back.....and end the week......NEARLY..... in the green....ONLY down for the week by....drum roll please.......(-0.13%) (see correction note below). A victory considering where we were yesterday after the foolish mid day comment by the government. They need to learn to release that sort of STUFF.....after the market closes or better yet....Friday after the close.

FOR THE WEEK

DOW year to date +11.23%
DOW for the week (-0.46%)

SP500 year to date +11.29%
SP500 for the week (-0.13%)

NASDAQ 100 year to date +8.17%
NASDAQ 100 for the week (-0.72%)

NASDAQ year to date +8.76%
NASDAQ for the week (-0.25%)

RUSSELL year to date +15.04%
RUSSELL for the week +0.41%

(I corrected the SP500..."for the week".....above. The early data that I got from Schwab was either wrong or more likely....changed as it settled after the close)

 

We are all set up for the BIG week next week. We will see some of the BIG CAP STARS report next week. The anticipation will be in the air.

The SP500 at +11.23% year to date....is kicking ass. That is a NICE start to the year. If we can continue at this pace.......with a few bumps along the way.....we may be looking at a highly unusual......THREE YEARS in a row of.....well above average....gains.

I am now just below my new all time high which was set about a week ago. I am at +7.2% year to date as of today. VERY satisfied with where I am siting right now....with about half of my portfolio STILL lingering so far this year. With the lingering holdings being my.......BIG CAP STARS.....I see big potential to take off at some point in the year.

 

The big question....will we see another correction this year. I would guess that there is good potential for a correction in the May to June time period. ALSO......in the end of summer.....early fall time period......August to September to October. With the potential gains that we have.....OR WILL HAVE......THERE IS A GOOD PROBABILITY......that we will need a few little periods of consolidation to allow the markets to catch up. AND.....this will be in line with the continued volatility and erratic week to week markets that we have been seeing for the past year. As usual.....I STILL expect that EARNINGS will drive the positive market time periods.....ALL YEAR.

My WAP for this year.....Wild Ass Prediction........SP500 at year end +21% to +26%.

 

HERE is another little take on the year.....of course positive. We are going to see more and more commentary....window dressing....as writers and stock prognosticators.....try to catch up with the BOOMING markets....and....establish that they actually saw it coming......regardless of whether they REALLY did or not.

We're Expecting Higher GDP Growth--and Higher Inflation Too
We've increased our U.S. GDP growth forecast.

https://www.morningstar.com/article...ng-higher-gdp-growth-and-higher-inflation-too

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

"We’re increasing our 2021 U.S. real GDP growth forecast to 6.2% from the 5.3% we expected in our last update in February. The main reason for the upward revision is a faster-than-expected U.S. consumer recovery. We now expect 7.5% real consumption growth in 2021 versus 6% previously.

We’re also increasing our 2021 inflation forecast, although we think the Federal Reserve will have little trouble keeping inflation under control.



U.S. Consumer Data Points to Faster-Than-Expected Recovery

Since our February update, the consumer data released in the last two months has been surprisingly strong. First, goods consumption/retail sales has been stronger than we expected, in part because consumers have spent a large share of their stimulus checks. Retail sales jumped in January and March in response to each wave of stimulus check disbursement.

Second (and equally important), it appears that the consumer services recovery is now proceeding rapidly. While personal consumption in services was essentially flat in January and February, we expect March data (to be released at the end of April) will show a sharp uptick. The restaurants and bars item of the retail sales release shows a 13% gain in March, with spending now just 5% below prepandemic levels. Likewise, the recovery in U.S. airline traffic indicates a normalization of consumer services behavior.



Originally, we had thought there was a good chance that consumer services could prove sluggish until the arrival of herd immunity in the United States (which we expect to occur around the beginning of June). By contrast, the recent data suggests that consumer services spending may recover most of the way to prepandemic levels even before the arrival of herd immunity. With around 40% of Americans having received at least the first dose of a COVID-19 vaccine as of April 19 (and average new cases having fallen around 70% since the January peak), consumers are responding to the diminished risk of illness by normalizing their behavior.

As we have discussed before, a consumer services recovery is vital for the overall economy. As of the fourth quarter of 2020, consumer services expenditure accounted for the entire U.S. GDP shortfall versus prepandemic levels. Also, a consumer services recovery should lead to a near-complete recovery in the job market.

More on This Topic

Altogether, we now expect 7.5% real consumption growth in 2021 versus 6% in our last update in February. Faster consumption growth is the main driver of our increased overall GDP forecasts. We now expect real GDP growth of 6.2% in 2021 versus 5.3% previously. Our growth forecasts for 2022 and later years are largely unchanged. We now expect U.S. real GDP growth to surpass our pre-COVID forecast by 2% by 2024.



Our latest GDP forecasts are roughly in line with the consensus average, which calls for real GDP growth of 6.1% in 2021 and 4.4% in 2022. Some forecasters expect up to 200 basis points greater growth than we do through 2022. However, we’re skeptical as to whether the economy’s productive capacity (or potential GDP) can accommodate an increase in output to that level. Fiscal stimulus and other factors boosting the demand side of the economy are only important insofar as GDP is below its potential level, meaning there’s still slack in the economy, or an “output gap.” We think there’s a good chance the output gap will be closed by 2022.

Increasing Our 2021 Inflation Forecast

Market-implied inflation expectations have soared in recent months. The five-year break-even inflation rate has surged, reaching 2.55% as of mid-April.

Also, heightened inflation expectations have finally begun playing out in the consumer price data, particularly for March. While the total Consumer Price Index had been increasing for several months on the back of recovering energy prices, core CPI growth was fairly muted until posting 0.3% month-over-month growth in March. Somewhat surprisingly, the uptick was driven by consumer services, despite the breakneck pace of consumer goods demand.

We still think that these growing pricing pressures reflect largely transient factors. While extraordinary demand for goods may generate pricing pressure in coming months, the eventual shift of consumer demand from goods to services should serve as a relief valve. Also, while the rapid rehiring underway in the services sector could induce wage inflation, this could moderate once unemployment benefits expire later in 2021.

With that said, our increased forecast for 2021 GDP growth will translate into higher inflation in 2021 than we originally expected. We now expect inflation (as measured by growth in the Personal Consumption Expenditures Price Index) of 2.3% in 2021 versus 1.8% previously.



Overall, we forecast a 2.2% average PCE inflation rate over the next five years. This is roughly in line with the expectations implied by the 2.55% five-year break-even rate, as the latter is based on the CPI, which historically has grown 20-50 basis points faster than the PCE Index on an annual basis. The closing of the output gap could occur as soon as 2022 and will exert consistent upward pressure on prices.

While the Federal Reserve is likely to let inflation run slightly above its 2% long-run target over the next few years, this is consistent with its new average inflation targeting program. We think the Fed will have little trouble taming inflation before it gets out of control.

MY COMMENT

AMEN brother. Add in the STABLE 10 year yield....today at 1.558%.....and the fact that it is STILL at a historic LOW....and you have the basis for continued great market results going forward.

 

NOW.....here is what MANY were saying and predicting....earlier this year. At least this writer is owning up to his MISS. Most will simply......pretend.....that what is happening now is what they thought all along.

My Worst Forecasting Mistake

https://www.project-syndicate.org/c...e-dip-us-recession-by-stephen-s-roach-2021-04

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

"NEW HAVEN – I have been in the economic forecasting business for close to 50 years. I got my start in the early 1970s, on the research staff at the Federal Reserve in Washington, DC, before taking my crystal ball to Wall Street for over 30 years. For more than a decade, it has been the ivory tower at Yale – still dabbling in forecasting from time to time but mainly teaching, writing, and speaking.

Over that long stretch, my forecasting record has been mixed. There were a couple of memorable calls at the Fed, where I warned of a sharp recession in the mid-1970s and intractable inflation later in the decade. But I look back with the greatest pride on my collaboration with Larry Slifman in building the Fed’s first “black box” forecasting model that I believe is still largely in use today. We worked around the clock for several weeks to program linked computer-based spreadsheets (unheard of back then) as a replacement for the single-iteration monthly exercise previously done manually on a Monroe calculator. Our so-called judgmental approach was the point-counterpoint to the Fed’s renowned large-scale econometric model.

My Wall Street efforts were more thematic. I continued to forecast but focused more on big-picture developments such as corporate debt and restructuring in the late 1980s, the productivity debate of the 1990s, global healing of a post-crisis world in the early 2000s, and then my sweet spot, China and its impact on the global economy. My Wall Street forecasting record was good enough to maintain job security at Morgan Stanley, although there were several close calls.

Attempting to predict interest rates was my least favorite part of the job. With good reason. I remember walking into the old Morgan Stanley investment banking meeting room and seeing a chart of my predecessor’s bond market forecast sitting upside down on the floor. I was determined to avoid that fate. When my favorite bond trader started calling me “dart man,” I made an executive decision to disengage and hire an interest-rate strategist. Survival of the fittest, I guess.

I should have known better when I came off the bench as a retired forecaster last summer and penned a piece with the now memorable title of “America’s Coming Double Dip.” I argued that the post-pandemic rebound – a record 33% annualized pop in GDP in the third quarter of 2020 following an equally sharp 31% contraction in the second period – was nothing more than an arithmetic yo-yo.

But that brilliant insight wasn’t really the point. I went on to stress that the nascent recovery was likely to be aborted by a relapse, as had occurred in eight of the preceding 11 recessions since the end of World War II. A few months later, taking comfort from some economic indicators that had broken my way, I committed the most egregious forecasting sin of all: giving a date. I actually wrote that the coming double-dip was likely to occur by mid-2021.
The worst forecasting mistake of my career? It sure seems that way. Rather than the relapse that I was looking for, there is now widespread talk of an open-ended boom. My well-trained successor team at Morgan Stanley, which has been aggressive and right with their forecast of a V-shaped snapback from the COVID-19 shock, is now calling for a nearly 10% annualized increase in US economic growth in the first half of 2021. That’s not exactly the dip that I, their former team leader, was expecting. Had I still been in that chair, the cold sweats of my job-security nightmares undoubtedly would have returned.

Wall Street forecasters quickly learn the rules of culpability. Like bond and stock traders, the “mark-to-market” mindset forces intellectual accountability on economists and, sometimes, even on market strategists. That’s when it pays to have a cogent analytical framework that tells you what went wrong and why.

The double-dip call was premised on three considerations: historical precedent, lingering vulnerability, and the likelihood of another shock. The history of earlier business cycles was on my side. And with employment and real output remaining well below pre-pandemic peaks – especially for face-to-face activity in the all-important services sector – there appeared to be a compelling argument for lingering vulnerability. Lastly, with a new surge of COVID infections in November, December, and early January triggering partial lockdowns in about three-fourths of all US states, the case for another shock seemed reasonable. Putting it together, I concluded that it was only a matter of time before another dip would occur.

So, what happened?Basically, the shock turned out to be short-lived – also for three reasons: vaccines, human nature, and Bidenomics. Just as Americans signed up for shots, COVID infection rates plunged to just 26% of their early January peaks. That development, together with a sharply accelerated vaccination trajectory, pointed to sooner-than-expected herd immunity and a prompt end to the pandemic. Second, dismissing worrisome new COVID variants, impatient Americans and their compliant political leaders are breaking with recommended public health restrictions. And, third, the fiscal floodgates have been opened as never before: the $900 billion package of late 2020, followed by the $1.9 trillion American Rescue Plan in March, and now a proposed $2 trillion-plus of additional stimulus for infrastructure writ large dubbed the American Jobs Plan.

With the end of COVID in sight, all this has turned into a powerful pro-cyclical fiscal stimulus, which, together with ongoing unprecedented monetary accommodation, has made the boom a one-way bet. And those ever-fickle economic indicators that were heading down late last year have now broken to the upside with a vengeance.

In the end, the confluence of science, politics, and the indomitable human spirit left my out-of-consensus double-dip call in tatters. It wasn’t my first forecasting mistake, but it is probably the most glaring. Mea culpa is an understatement. Back to the ivory tower."

MY COMMENT

A RARE mea culpa by a predictor.

I have to agree with his reasons for the ELECTRIC recovery and HUGE "V" shaped recovery we have seen since last March.....except of course....the reference to the current President. It was....and is.....clear that ANYONE that had been President would have continued the stimulus and an infrastructure bill. DITTO...to the credit for the vaccine that is making this recovery possible. DITTO to the Tax cuts that kick started business. BUT....who cares....he is from YALE and the Washington insider establishment....after all.

AND.....that is NOT the point of this comment. It is not about who gets credit....it is about what is ACTUALLY happening. I have no concern or desire to argue how many angels can dance on the head of a pin....or....who gets credit for this EXTREME recovery. Many on this board......SAW the reality coming and acted accordingly.

EVEN those that did not see it coming....continued to invest and hold in there as LONG TERM INVESTORS and are now REAPING the benefits. In fact.....the long termers.....on here have been REAPING the benefits for 10 months now. CONGRATULATIONS.....to us ALL.

 

HERE is the......hard-core....working his fingers to the bone.....sweat dripping off his brow........hunched over the four monitors full of charts and data.......sure to die an early death..........maniacal computer keyboard clicking and pumping the data.......day in the life......of a long term investor:

"I am sitting home enjoying a nice beverage and have absolutely NOTHING to talk about and I’m bored. Do I really care? Nope
My wife tells me I need to shave- that troubles me more. Gonna go play pickleball with our friends later today."”

 

Sounds like....ANOTHER long term investor....stocks and property...above. Helping the kids and watching the kids activities and playing some sports with the kids.....what is important.

If you do some analysis of INTC.....put up your thoughts. I am sure there are many others on here that own or are interested in that company.

Hips.....they can be a pain. I had to get a hip replacement six years ago. I put up with it till I could not stand it anymore. It got to where the pain and physical symptoms were severely limiting how far I could walk. The result....amazing and well worth it. Instant relief. I went bowling three weeks after. They have you up and walking in the hallway of the hospital within an hour of leaving recovery. No PT required. Hardly any pain. Amazing technology.

I got it done two weeks BEFORE my 65th birthday. I decided that I was NOT going to wait and stick the government and the taxpayers.....MEDICARE......with my bill. SO....I had the surgery two weeks before I went on Medicare and my private insurance picked up the $100,000 tab.

As a self-employed person my entire life......and private pay medical insurance customer through my entire retirement.....I always had a $6000 deductible policy. In spite of the BIG deductible....I was still paying $14,000 per year for a policy that NEVER covered anything. I basically had the insurance for some HUGE medical bill.....and more importantly......to get the insurance company rate and discount for any medical care required.

My good old insurance company...issued some MASSIVE rate increases against us private pay customers nearly every year....driving me into plans that paid less and less and had BIG deductibles. Basically catastrophic coverage. I have to admit....part of the reason I decided NOT to wait the two weeks for Medicare was........to STICK that bill to the insurance company that had NEVER paid for anything.

They screwed around with paying the $90,000 hospital bill and I had to threaten to appeal....they finally paid......"it was just a mistake". I am sure they were probably pissed off having to pay the bills just a few weeks before the "customer" went on the government dime. I figured that I got back 8 years of premiums for that surgery......and....they finally had to pay for something......yes, perversely.....it made me feel good.