The Long Term Investor

My NVIDIA...which is a long term hold.....is doing nicely as we.....SLOG...... to the date of the split. Up by $6.14 at the moment. It started the day weak.....I assume due to the news below. As I mentioned previously....I now have 35 shares on margin.....in addition to my normal long term shares.......which I will hold at least till shortly after the split and perhaps long term.

Qualcomm reportedly offers to invest in Arm as regulators threaten to block Nvidia’s $40 billion acquisition

https://www.cnbc.com/2021/06/14/qua...n-arm-as-regulators-threaten-nvidia-deal.html

MY COMMENT

It is hard to say if this acquisition will happen. There is a lot of negative news about the various.....GOVERNMENT..... reviews that are pending. It is hard to know how much of the negative news is simply PR HYPE by companies that want to see the deal killed.....or....how much of the reporting is actually accurate. Much of this sort of news is simply unsupported opinion.....being called....news. At the moment...I am thinking that the chance of this acquisition happening is......AT BEST.....50/50. If I had to......bet my life....I would bet that it will not happen.

 

HERE is the economic TURMOIL that comes with closing down the entire economy.

Welcome to the summer of quitting. Why many of us are saying goodbye to our jobs

https://finance.yahoo.com/news/welcome-summer-quitting-why-many-120003610.html

(BOLD is my opinion OR what I consider important content)
In late May, Sarah Lynch pulled the rip cord.

The 31-year-old brand designer had been working at Coursera, the online education company, for five years. During the pandemic, a booming business in virtual learning meant Lynch was busier than ever — and sinking into burnout.

"I love my company, and I love my work, but I couldn't keep pushing on through," Lynch said. "I didn’t have really any energy, I didn’t really enjoy what I was doing anymore, I couldn’t really focus."

Then Coursera went public. Like many workers on the upper levels of the income scale, whose savings have been buoyed by a bull market, Lynch found herself sitting on a financial cushion for the first time in her life thanks to her stock options.

"I recognize it’s extremely privileged to have this cushion now, but I can take the time off that I’ve really been wanting to," Lynch said. "I don’t have another job lined up after this, and that’s like — I come from a working-class background, you don’t just quit a job and not have another job." But she's looking forward to spending time working on her design portfolio, slowing down, reading some books and taking a pottery class.

"I haven't had a break in 10 years," Lynch said, since she graduated in the recession, worked her way through a master's degree and landed a good job. Now she's rethinking her future: "Do I really want to burn myself out over and over again?"

Lynch is part of summer 2021's hottest professional trend: quitting your job.

More than 3.9 million people quit in April, according to the Bureau of Labor Statistics, marking the highest quit rate — the ratio of people quitting their jobs to total employment — since the agency began collecting that information in 2000. The number of job postings also hit a record high, with 695,000 more open positions than unemployed workers.

Workers in industries that typically have a high level of turnover, such as retail, warehousing and food service, quit in large numbers. Professional and business services — a catch-all category that includes many of the country's office jobs — saw the second-highest surge in quits, with 94,000 more workers leaving their jobs in April than in March.

Untangling trends and meaning from national numbers can be difficult, and quitting is not an option to be taken lightly for most workers. In hospitality or Hollywood, where most workers have been out of a job for much of the last year, going back to work at all is still a priority.

But human resources experts say that the white-collar workforce has multiple reasons to be eyeing the exits this summer.

Anthony Klotz, a professor of management at Texas A&M's Mays Business School, has researched the psychology of quitting for much of his career. He said the numbers point to pent-up demand for a change. Nearly 6 million fewer people quit their jobs in 2020 than in 2019, according to BLS statistics, which Klotz ascribes to workers "sheltering in place" as the pandemic rocked the global economy.

After a year of unprecedented stress, workers are also burned out and reexamining how to live their lives. "People have had epiphanies over the past year," Klotz said. "We all want to pursue life, liberty and happiness, and many of us have realized our job isn't the best way to get there."

At the same time, the booming stock market, reduced expenses under lockdown, extended unemployment benefits and financial stimulus have meant that segments of the workforce have healthy savings accounts — or at least less debt to worry about if they take the plunge.

Brett Wells, director of people analytics at Perceptyx, a company that works with a number of Fortune 500 companies to survey employee opinion and sentiment, said his firm keeps close tabs on whether employees are thinking of quitting. "When an employee tells you they're going to leave, they do," Wells said. "We've seen that spike, for a variety of reasons."

The top reason for wanting to leave, Wells said, is the desire for flexibility, both in hours and the ability to work from home. "That's at the forefront as offices start to go back," Wells said. "If organizations don't meet those demands, we're going to see people vote with their feet."

Wells said that higher echelons of management tend to be stuck on the idea of "office-ism": that in-person work is intangibly superior. That attitude shows up in corporate leadership regardless of the age or generational cohort of leaders, according to Perceptyx research.

After the executive ranks, Gen Z workers — those in the first few years of their careers — are the most likely to want to return to the office, Wells said. Despite being full digital natives, these younger workers say in surveys that they're the most afraid of missing out on professional development by working remotely.

One group in particular has already dropped out of the workforce in record numbers: working mothers.

"We've seen them mass exit in much larger waves," in both front-line and senior leadership positions, Wells said, as the demands of juggling parenting, teaching and working from home ratchet higher. Regardless of parental status, Perceptyx has also found that men are more enthusiastic about returning to the office, with women expressing a desire to go back in one fewer day per week on average than their male peers.

But this summer may just represent a continuation of trends that have been building for years, said Tami Simon, who leads the global consulting business at the benefits and HR consulting firm Segal.

"I think we sometimes have the tendency to oversimplify these issues," Simon said. Demographic shifts in the American workforce mean that just as baby boomers are starting to leave the workforce in larger numbers, millennials are hitting their prime working years, when they have the most job mobility of their careers.

"The good news is organizations are great at innovating, but they need to be as innovative in terms of how they manage and retain employees as they are in the core of their business," said Texas A&M professor Klotz.

Based on conversations he's had with people this year, he believes we may see a shift toward shorter workweeks as employers try to accommodate shifting demands. "A number of people don’t want to work 40 hours a week, they want to do 20 or 30, with the understanding that there's less pay," Klotz said. "You might think, 'Oh, these are millennials who don't want to work as much,' but a lot of people I talk to are people near retirement, saying they could work another 10 years at 30 hours, but not 40."

Klotz has also seen some companies shift to offering annual monthlong sabbaticals to avoid burnout and sees offering more flexible work-from-home arrangements as part of a retention strategy.

"From a research standpoint, one of our fundamental needs as human beings is the need for autonomy," Klotz said. Employers demanding a return to in-person work are "asking us to give up this fundamental need we've had satisfied during the pandemic" by working at home.

But shifts in benefits and working structures won't be enough to keep people who want a major change.

"I’ve been going through it, honestly," said Krystine Altamirano, a 28-year-old Miamian who works in accounting at a private equity firm that she plans to leave in August — her contract required her to give 90 days of notice.

The decision to quit wasn't easy for Altamirano, who thought she was on a clear career path in finance before the pandemic gave her time to rethink everything. "I've been kind of beating myself up, like everyone else does this, everyone else has stressful jobs, and they just deal with it and eventually retire," Altamirano said.

But in the spring, she realized she couldn't go on. "Life shouldn't be so stressful all the time," she said. "Capitalism has just gotten more and more detrimental to people’s mental health."

She wants to change careers entirely, maybe shift to education, and plans to figure out where to go next after taking some time off and living on her savings.

And knowing that she's part of a quit wave this summer comes as a comfort. "I think it's cool that it's such a common thing now," Altamirano said. "It makes me feel less alone.""

MY COMMENT

YES........at the moment...it is a glorious time for employees to shift jobs....they have POWER. Or...on the other hand ....you have those siting at home collecting OVERSIZE benefits. Both trends WILL end....quickly. It is nice right now for people to have options....BUT.....it is going to be a very short term trend. AND.....some WILL be left out......in the end..... in the typical game of musical chairs.

As to.......work from home......management is RIGHT.....there are DISTINCT advantages INHERENT in having people work......at the office. If you are a business......MUCH.......of what you do is DEPENDENT on the IN-OFFICE pipeline that keeps you supplied in terms of.....corporate culture, training of future management, evaluation of employees work and social skills, etc, etc, etc. BOTTOM line....if I am management....I want to....."KNOW"....my employees on a human level......not just on what comes in from their home computer.

If I was a worker....especially a white collar worker.....I would be EXTREMELY WARY.....about working from home. If this becomes the norm...here in the USA....there are gong to be a HUGE NUMBER of surprised workers when their job is outsourced to a....."stay at home" worker.....in another country.

 

YEP....you are correct Stock.Jock-e......there is a BIG trend of BIG investors and companies buying single family housing. Obviously the potential for...... oversize capital gains.....while getting the rental income short term..... is driving this trend.

I will be curious to see if they end up dumping these properties on the market when the housing market goes back to normal annual gains in value for single family homes......or.....as local markets experience a BUYERS market.......or....when local markets collapse. Does this trend have long term legs or is it a temporary FAD? Who knows? It is certainly ONE factor in the GREAT GAINS in value that current homeowners are seeing in many local markets around the country.

As to unemployment benefits....yes they are coming to an end....quickly. You used to have to prove that you were looking....but we all know how easy it is to deal with that requirement if you dont want to work. Plus....we weakened these sorts of requirements due to the pandemic. MOST incentives to NOT work should be pretty much over within about 1-6 months depending on your state.

 

INTERESTING.....I was just surprised to see that the GAINS I had earlier today....are STILL there and have actually increased. I have 5 stocks up and 5 down. Today.....ALL the gainers are in the BIG CAP TECH world. Of course....this could quickly change over the next hour plus.

Lately....it is like the markets start every day...waiting for some shoe to drop......of some minor black swan to fly in for the day. Than....as the day goes on.....the market is either stable or goes up a bit...when nothing negative shows up in the news of the day or the commentary. Seems like a VERY nervous market....even though it has been pretty good for a while now. An......AFTER SHOCK.........of the pandemic and the lingering stress that people are still under after the past year.

 

HERE is a CRAZY little article.

The 60/40 rule of investing is dead, experts say — it's time to get more creative

https://finance.yahoo.com/news/60-40-rule-investing-dead-180000135.html

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

"For decades, investors have put their financial future in the hands of ol’ reliable: the 60/40 rule.

With 60% of your money in stocks, you’ll have enough growth potential to meet your goals. And with 40% in bonds, you’ll have a stable source of income to fall back on in case your stocks don’t perform.

At least, that’s the conventional wisdom. The problem is that the investing landscape today looks completely different compared to 20 years ago, let alone 70 years ago.

While it’s not universal, analysts from major firms like Bank of America, Morgan Stanley and JPMorgan have all proclaimed the death of the 60/40 rule in recent years.

David Kelly, chief global strategist for J.P. Morgan Asset Management, says a “plain vanilla” portfolio of 60% global equities and 40% U.S. bonds is likely to net an annual return of just 4.2% over the next 10 to 15 years.

Why? The simple explanation is that bond yields today are miniscule compared to the yields of yesteryear.

For example, the return on a 10-year Treasury note reached a high of 15.84% back in 1981. By the end of the decade, it had fallen to 9.5%. It’s currently hovering around 1.5% — not that much better than some savings accounts or certificates of deposit.

As a result, many investors are looking past bonds for other low-risk assets that still provide reasonable returns. Some are even going beyond stocks in search of higher growth potential that can pick up more of the slack.

What alternatives are out there?
Thanks in part to advancements in technology, the average investor has access to far more options today — it’s even possible to invest with only your “spare change.”

Here are five ways to inject more diversity into your portfolio, beyond simple stocks and bonds:

Farmland

If it’s good enough for one of the richest men on the planet, surely it’s good enough for you.

Farmland can act as a shield against volatility — even when the economy goes through a recession, people still need to eat. And yet, there’s evidence to show you can expect better returns from farmland than bonds, gold and often the stock market.

Using a new investment platform, you can join with other investors to buy stakes in individual farms without having to run one yourself. You can get a cut from both the leasing fees and crop sales, providing you with a cash income while the value of the asset increases.

Exchange traded funds
Exchange traded funds, or ETFs, combine the convenience of stocks with the diversification and reduced risk of mutual funds.

Instead of buying into a single company, you get a share of a number of different assets, such as stocks, commodities and bonds. The typical ETF is based on a financial market index, like the S&P 500, and contains all of the individual stocks or other investments that make up the index.

ETFs can be bought and sold just like stocks and tend to have lower fees than mutual funds.

Real estate

Want to get a cut of the hot housing market right now but can’t afford to buy a property or two?

A real estate investment trust, or REIT, will allow you to get your foot in the door without having to fork over your life savings or commit to becoming a landlord.

With as little as $500, you can help fund the purchase of commercial real estate developments and then reap the profits. Who knows, that could put you on the path to buying your own home.

Hedge funds

For the daring (and wealthier) investor, hedge funds can offer both diversification and greater returns.

These institutions are known for using unconventional and risky investing strategies that don’t align closely with the stock market. They often invest in alternative assets themselves, such as private companies, distressed debt, currencies and commodities.

While hedge funds are typically only open to accredited investors, some investing apps are trying to make hedge funds more accessible to all.

Cryptocurrency

Investing in crypto is easier than you might think — you can buy bitcoin and other digital currencies through popular investing apps — but it’s not for everyone.

Yes, some people have made a fortune off the incredible volatility, as one bitcoin is now worth tens of thousands of dollars. Meanwhile, billionaire investor Warren Buffett calls the stuff “rat poison squared,” pointing out its limited use as a form of currency.

The potential is there, but don’t invest more money than you can afford to lose in the next big swing."

MY COMMENT

This little article is......SO SCREWED UP.....on so many levels.

First....I imagine...that most people using a 60/40 portfolio tend to be pretty conservative investors that follow the research that this type of mix is VERY effective over the long term. If....I was doing this sort of strategy....I would probably NOT use international stocks but stocks of companies from the ....USA.

Would I do this strategy right now.....NO. There is too much potential for capital losses in bonds going forward......and......I dont like investment........GIMICKS.......like this one or the 4% retirement rule. BUT...this is a PROVEN strategy that DOES......and.....in the future......WILL.....continue to work and provide great returns.

Where this article gets REALLY CRAZY is in the recommendations as alternatives.......farm land.....Crypto.....Hedge Funds. These are INSANE recommendations for the average 60/40 investor. A TOTALLY different and extreme level of risk.......and.....probably totally unsuitable for such investors. If you remember the.......... "SUITABILITY RULE"......for brokers......you are probably an older investor.

The other two alternatives......real estate.......and......ETF's.....are also not very smart. Many older stock investors.....which 60/40 investors tend to be......are NOT suddenly going to get into real estate. Now REITS....that is a good alternative....but you better do some real research before you jump into this world. As to ETS......DUH.......any 60/40 investor is likely to ALREADY have some SP500 ETF or other stock ETF in their portfolio.

This little article shows the BIG DANGER of what is being put out there as investing advice these days. A very dishonest article....from using the interest rates of the 1980's to talk about returns.....to using "global stocks"....to everything else. It TOTALLY.....mixes up and removes RISK TOLERANCE from the equation. Actually....this stuff is simply delusional......and MUST represent the writing of someone that has NO KNOWLEDGE of investing.....or.....concern for their readers.

NOW......If you want to see the really good advice....look at the comments to the article. Have you noticed that MOST of the major newspapers and sources now say......"commenting is not available for this article"........and they NEVER will be again. My view...this is due to the fact that the comments USUALLY expose the writer as a MORON....the comments are usually MUCH MORE educated. There are a lot of comments to this article....many of them are by people that have a lot more brains than this writer, for example:

"So many bad ideas in one place at one time. If you are investing for the long term - you should always look at the long term and look for stable investment opportunities - the type is much less important than long term stable growth with a history of low risk and low volatility. The problem is most so called investors are either gamblers or act likel gamblers looking for the big win. Long term - in other words what you invest your retirement fund, your IRA or401k, your long term savings - needs to be based on sustainable growth and low risk. Bonds are not a particuarly good investment for most people. They simply are too risky if you cannot buy the actual bond - mutual funds based on bonds are actually quite volatile and therefore have fairly high risks. The actual bonds almost always have a very low return - current treasuries held for 30 years pay 1% or a year for the entire 30 years - and if you sell them in the short term and interest rates have increased - then they are worth less. Right now, low volatility broad market funds seem to be the highest returns with the lowest risk - SPLV, USMV, SPHD - all pay dividends and have a ten year history of growing 7% or so a year. And they are far less volatile than the regular broad market ETFs. You need to do research - this stuff takes some effort and some knowledge - there is no formula that works long term. There is no investment that is guaranteed long term. You must do your own research, look at all the factors."

and

• "22 hours ago
  Was 100% invested in stocks while I was working. Switched to a 65/35 mix after retiring a few years ago. My investments now earn more than I did while I was working.
  18 hours ago."
• 
  "The people who followed the 60-40 rule for the last few decades are probably sitting well enough to handle a lowly 4.6% return over the next 10-15 years. The problem is the people who hasn't invested well or at all and thus feel compelled to swing for the bleachers and hit home run.
  16 hours ago"
• 
  "At my current age of 68, I invest 60% in stock index funds and 40% in a stable value fund that pays 1.9%. Going forward I will use the two bucket approach for spending. During bad market years I will spend from the stable value fund and during good market years I will spend from the stock fund. I am also delaying social security to 70 to mitigate spending needs. The 60-40 rule is not dead!!!"
  22 hours ago
• 
  "Experts were saying the 60:40 rule is dead in the 1990's. For decades, mutual fund companies have had target date funds that increase % stocks the younger you are. If anyone said "60:40" to me, I'd be as amazed as if they said, "Buy war bonds!" It would be of service for Yahoo to investigate who has been saying "60:40" in the past decade or so and to see how much they make if people buy bonds!"
• 
  21 hours ago
  
  "Pushing the retail investor up the risk ladder... sure to cause a lot of problems. Good luck to the lot of you who follow this advice... and don't come crying when you get hurt."
  5 hours ago
  
  "Oh, so the 60/40 rule "likely" won't generate higher levels of returns tomorrow as it did in past years? How "likely" is this supposition to be correct years down the road? Compared to the associated risks and wealth requirements needed to be able to invest is most of the alternatives listed in the article, the 60/40 rule perhaps still is and should be the most productive and least risky investment foundation for most Americans. The only true alternative listed in the article for most American investors is ETFs, which may be spot on--with a 60/40 allocation thereof!"
  22 hours ago
  
  "No thanks, most of these alternatives are way too risky, except for real estate."
  
  MY COMMENT AGAIN
  
  At least most of the over.......80 comments.....to this MORONIC article will give you some level of respect and belief in the knowledge of investors...compared to this writer who is stretching to find and talk about the NEXT........new normal......and.....how different investing is today. YEAH.....RIGHT. Perhaps...the writer was just having a bad day....or....this article is a reflection of writing about something.....versus....actually successfully doing it.

 

AND....here is some info on my favorite holding....at least till the split happens.

Nvidia Is in Rally Mode: Here's How High It Can Go

https://finance.yahoo.com/m/4b158062-3632-395f-a7ef-cc05800411b6/nvidia-is-in-rally-mode-.html

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

• "NVDA) - Get Report shares have finally been giving bulls something to cheer about as the stock scorches higher.
  
  Just like most of big tech, Nvidia topped in early September, hitting roughly $588 a share. We’ve had spurts above that level, but none of the rallies have been sustainable.
  
  That’s despite a shortage in semiconductors keeping demand elevated. It’s also despite the crypto-mining market keeping demand high for mining-specific chips.
  
  Even with strong earnings and an impressive GTC event (where management again updated its guidance above consensus expectations), Nvidia stock couldn’t get moving.
  
  Others like Apple (AAPL) - Get Report and Amazon (AMZN) - Get Report have been experiencing the same thing - strong operations and better-than-expected results but a stagnant share price.
  
  For Nvidia though, shares finally broke out after the company’s most recent earnings report. Now investors are trying to figure out just how far this stock can run.
  
  Trading Nvidia
  
  Daily chart of Nvidia stock.
  
  Chart courtesy of TrendSpider.com
  Shares stumbled for a day after the company reported earnings in mid-May. Growth stocks were still in a bear market and investors weren’t sure if they should buy Nvidia despite strong results.
  
  It took a day to figure out, but then they started to gobble up the stock.
  
  However, with sustained growth acting as a tailwind and a 4-for-1 stock split coming on July 20, buyers may continue to bid this name higher. That’s what we saw near the end of summer last year with Apple and Tesla
  
  In any regard, the rally here has been steep and while Nvidia stock has rested for a few days at a time, it still has not tested 10-day moving average in almost a month.
  
  As it stands now, shares are hitting the 161.8% extension areas from both the larger and shorter ranges from 2021. Additionally, there is a bit of divergence on the Williams %R reading.
  
  These observations have me a bit cautious on the stock in the short term, but not in a bearish way. Rather, it leaves me mindful of some potential consolidation, which to be honest, would be healthy after such a big rally.
  
  That said, I am bullish on Nvidia. If this stock can maintain the 10-day moving average and hang around $700, it opens the door for higher prices. Specifically, it keeps $750 to $766 on the table, the latter of which comes into play around the two-times range extension.
  
  At $750 post-split, Nvidia would be trading at $187.50. That could leave room up to $200 in a post-split world or $800 in pre-split world.
  
  For long-term investors or traders, the 261.8% extension up near $860 seems impossibly far off, but if Nvidia can continue to trend higher, I wouldn’t rule this target out in the future.
  
  On a close below $690 and the 10-day moving average, we could get a retest of the $650 breakout level and/or the 21-day moving average. "
  
• 
  
• MY COMMENT

This article doing strange things to my typing margins. BUt....yes....NVIDIA is on a tear right now. It is.....ALL....due to the split. Yes...earnings were great...but....totally ignored. This is ALL ABOUT the SPLIT. My price prediction......"guess"....for the day after the split........$810 to $850 per share....or......about $200 to $215 post split.

In the opening sentence I DO NOT mean to imply that I would not hold NVIDIA after the split....I will continue to hold it as a long term holding. I am guessing that this little rally will quickly PETER OUT after the split. the next event after that will be the next earnings report.

I am NOT a TECHNICIAN and do not use Technical Analysis....so I have no comment on the Technical Analysis side of the article above.

For context......I......ADDED TO........my shares of NVIDIA on the day of the split announcement.....May 21, 2021. I bought that day at $599 per share. At this moment NVIDIA stock is trading at.....$719.60. A 21% GAIN in 16 market days. HOPEFULLY....the mania will continue and increase up to the day of the split.

DISCLAIMER: I am not pushing anyone else to buy this stock or play the split.

 

A STELLAR close today. About an hour and twenty minutes till the close we were STILL kind of lingering. Than....BOOM....the markets took off for the last hour or so and ended UP nicely....even the SP500 that was in the red nearly ALL day. I ended up with a nice BIG GREEN day. I was able to beat the SP500 by 0.50%......and....hit a personal ALL TIME HIGH.....again. ( I am talking about the markets, not my personal life)(my all time......."high"......in my personal life was back in my college days)

What a POWERFUL CLOSE today. The market direction is DEFINITELY strongly UP. BUT....the markets are so nervous and scared of their own shadow....that we see these lingering opens every day...while the markets wait for some negative event to happen.......or......someone or some opinion maker.....to make some comment that can be twisted around and made into a negative. OR....some other sort of...."new normal" blather. The general markets......being worn out by stress from the pandemic.....may think like this....but BUSINESS.....not in the slightest. BIG BUSINESS....is off to the races.....and soon......in the next six months or so...small business will follow.

I see a BIG amount of excitement and positivity out there in the world everyday.........now that people are DITCHING the MASK.

 

I like this little article. It deals with a subject that many new or young investors face.......should I do a ROTH IRA or a regular IRA and what are the in's and out's of either.
Roth vs. Traditional IRAs: Which Is Right for You?


https://www.schwab.com/resource-cen...which-is-right-for-your-retirement?cmp=em-QYC

"An individual retirement account (IRA), either a traditional or a Roth, can be an effective retirement savings tool, but eligibility and contribution limitations mean one or both may not be right for you. Here’s a guide to help you choose.

What’s the difference between a traditional and Roth IRA?
A traditional IRA is an individual retirement account that allows you to make contributions on a pre-tax basis (if your income is below a certain level) and pay no taxes until you withdraw the money.¹ This makes a traditional IRA an attractive option for investors who expect to be in a lower tax bracket during retirement than they are now.

On the other hand, Roth IRA contributions are made with after-tax dollars. The benefit of a Roth IRA is that you can withdraw your contributions and earnings tax-free after age 59½ if you’ve had the account for at least five years, or you meet certain other conditions.² In addition, you can withdraw after-tax contributions to a Roth account anytime, tax- and penalty-free. However, if you make an early withdrawal of any earnings, you must pay taxes and penalties on them.

A Roth IRA could be a strategic option for investors who expect to be in a higher tax bracket during retirement than they are now. It can also offer flexibility to manage the combination of paying taxes and spending in retirement because you can withdraw money without increasing your tax bill, and you won’t have to take annual required minimum distributions (RMDs), unlike a traditional IRA.

How much can I contribute?
The maximum amount you can contribute across all your IRAs (traditional or Roth) in 2021 is $6,000, increasing by $1,000 to $7,000 annually if you’re age 50 or older. However, some rules affect IRA contributions and deductibility.

To start, if neither you nor your spouse is offered a retirement plan by an employer, there’s no income limit for contributing to a traditional IRA, and your contribution is fully deductible. However, if either of you participates in a workplace retirement plan, deductibility phases out depending on your filing status and income.

Contribution deduction eligibility for traditional IRA
Filing status (2021 tax year) Full deduction if income is: Partial deduction if income is: No deduction if income is:
Single ≤ $66,000 > $66,000 but < $76,000 ≥ $76,000
Married filing jointly, filer is covered ≤ $105,000 > $105,000 but < $125,000 ≥ $125,000
Married filing jointly, spouse is covered ≤ $198,000 > $198,000 but < $208,000 ≥ $208,000
Married filing separately NA < $10,000 ≥ $10,000
Source: Internal Revenue Service

Unlike with a traditional IRA, you can only contribute to a Roth IRA if your income meets certain limits.

Income eligibility for Roth IRA contributions
Filing status (2021 tax year) Full contribution allowed if income is: Partial contribution allowed if income is: No contribution allowed if income is:
Single < $125,000 ≥ $125,000 but < $140,000 ≥ $140,000
Married filing jointly < $198,000 ≥ $198,000 but < $208,000 ≥ $208,000
Married filing separately NA < $10,000 ≥ $10,000
Source: Internal Revenue Service



If you qualify for both accounts, how do you choose which one to contribute to?
If you think your tax bracket will be higher when you retire than it is today, you may want to consider a Roth IRA—especially if you’re younger and have yet to reach your peak earning years. The table below compares the hypothetical ending balances after a lump sum withdrawal in retirement for higher and lower post-tax tax rates based on a 25% marginal tax rate on the noted contribution amounts.

Traditional vs. Roth IRA: Impact of tax bracket at retirement on savings

Calculations assume a pre-tax contribution of $5,000 in the traditional IRA and a post-tax contribution of $3,750 in the Roth IRA, taxed at a 25% marginal tax rate. The hypothetical balance assumes a 6.5% average annual return over 25 years. The tax at withdrawal for the traditional IRA assumes a 30%, 25%, and 20% marginal income tax rate, respectively.

If you think your tax bracket will be lower when you retire, you may be better off taking the up-front deduction of a traditional IRA. If you think your tax bracket will be the same when you retire, it’s almost a wash for income tax purposes.
There are a few other advantages to a Roth IRA worth considering. You aren’t subject to RMDs with a Roth IRA, and it can be a flexible source of retirement funding. For example, you can withdraw a large sum if you have a one-time expense or other needs in retirement without increasing your tax bill. Allocating a portion of your retirement savings to a Roth IRA can increase the flexibility you have to manage taxes in retirement.

Also, you can withdraw contributions anytime for any reason without tax or penalty. However, just because you can doesn’t mean you should. Taking money out of your Roth IRA means you may miss out on the potential for compounding gains for retirement. And when you can put in only $6,000 for 2021 plus an additional $1,000 catch-up contribution if you’re age 50 or older, it might be difficult to make up the amount you withdraw.

Finally, we can’t know future tax rates with certainty. Contributing part of your retirement savings dollars to a Roth IRA after paying taxes can add tax diversification to your retirement savings in the event Congress increases tax rates in the future or when you retire.

Other things to keep in mind
Account rollovers
If you change jobs, you have the option to convert a traditional 401(k) directly into a Roth IRA without having to roll it into a traditional IRA first. Just remember, you must pay federal income tax on pre-tax contributions and earnings at the time of the rollover. Also, you may have other options, including keeping your assets in your former employer’s plan, rolling over assets to your new employer’s plan, rolling over assets to a new traditional IRA, or taking a cash distribution (on which taxes and possible withdrawal penalties may apply).

Roth 401(k)
An increasing number of employers offer Roth 401(k) options in addition to traditional 401(k)s. With a Roth 401(k), you can contribute a portion or all of your paycheck up to certain limits. You can also choose to have some of your paycheck go pre-tax into a traditional 401(k) and some post-tax into a Roth 401(k). Any employer match or contribution, however, must go into a traditional 401(k).

Unlike with a Roth IRA, contributions to a Roth 401(k) are not subject to earnings limits. This means that if you aren’t eligible to contribute to a Roth IRA because your income is too high, you may be able to contribute to a Roth 401(k). Distributions from a Roth 401(k) are subject to the same general tax rules as a Roth IRA, with the exception of an RMD requirement. You can avoid this by rolling over a Roth 401(k) balance into a Roth IRA after you retire but before your RMD age. If you’re eligible, don’t forget the Roth 401(k) option if a Roth makes sense for you.

Roth IRA conversions
If you’re ineligible for a Roth IRA because of income limits, some investors choose to make contributions to a traditional IRA and then later convert those contributions to a Roth IRA.

High earners who aren’t eligible to make Roth IRA contributions could make nondeductible contributions to a traditional IRA and then convert to a Roth (sometimes called a “backdoor Roth conversion”). The process is similar to any other Roth conversion but typically occurs immediately after contributing funds to a traditional IRA. However, there are some caveats.

You can’t pick and choose which portion of traditional IRA money is converted. The IRS looks at all earnings from traditional IRAs as one when it comes to distributions, including funds from Roth conversions. Traditional IRA balances are aggregated so that the amount converted consists of a prorated portion of taxable and nontaxable money.

So, making nondeductible contributions to a traditional IRA with the goal of later converting to a Roth IRA would likely work best if you have little or no existing deductible IRA balance to muddy the waters. Still, any earnings leading up to conversion would be subject to income tax. We generally suggest that the tax be paid with other funds, not withdrawals from the IRA, to maximize the amount available to convert and contribute to the Roth account.

The bottom line
Both traditional and Roth IRAs are great long-term savings tools, so educate yourself on the differences and make an informed decision that fits your retirement goals. Remember that tax laws are subject to change, so keep up with the latest news from the IRS. If you expect tax rates in the future will rise, either because your wealth and income will be higher when you retire or a change in tax law, consider Roth accounts. Also, be sure to talk with your CPA or tax professional about whether a traditional or a Roth IRA—or both—makes sense for you.

¹If you withdraw money from a traditional IRA before age 59½, your deductible contributions and earnings (including dividends, interest, and capital gains) will be taxed as ordinary income. You may also be subject to a10% penalty on early withdrawals, and a state tax penalty may also apply. Consult IRS rules before contributing to or withdrawing money from a traditional IRA.

²If you take a distribution of Roth IRA earnings before you reach age 59½ and before the account is 5 years old, the earnings may be subject to taxes and penalties. You may be able to avoid penalties (but not taxes) in certain situations. If you’re older than 59½ but haven’t met the five-year holding requirement, your earnings may be subject to taxes but not penalties. Consult IRS rules before contributing to or withdrawing money from a Roth IRA."

MY COMMENT

A good little summary of the rules and differences for investors that might have questions. A nice summary from Schwab. I did not BOLD this article since ALL of it is good content for long term investors looking for the right RETIREMENT VEHICLE.

 

Here is a good summary of the day tomorrow.

Stock market news live updates: Stock futures trade lower ahead of retail sales, inflation data

https://finance.yahoo.com/news/stock-market-news-live-updates-june-15-2021-223143155.html

(BOLD is my opinion OR what I consider important content)
"Stock futures traded lower Monday evening to give back some gains from the regular session, when both the Nasdaq and S&P 500 eked out record closing highs.

Contracts on each of the S&P 500, Dow and Nasdaq hugged the flat line. Investors are awaiting more key economic data out Tuesday morning, which will offer looks at both the strength of the consumer and extent of price increases across the supply chain.

The Commerce Department's May retail sales report is expected to register a monthly decline for the first time since February, reflecting more moderation in consumer spending after a stimulus-boosted surge earlier this year. And the Bureau of Labor Statistics' producer price index is anticipated to show a 6.2% year-on-year increase, matching April's near 30-year high as supply shortages and resurgent demand push prices higher.

These pieces of data will serve as some of the last prints to come out before the Federal Reserve issues its June monetary policy statement and holds a press conference with Fed Chair Jerome Powell. While no major policy changes are expected at this meeting, investors will be closely watching both the statement and press conference for signals of when the central bank intends to begin rolling back its crisis-era policy support systems, which had helped boost the economy and underpin stocks in their surge to new highs.

The first step in attenuating this support would be a tapering of the Fed's massive asset purchase program, with these currently taking place at a rate of $120 billion per month. The Fed has currently set a target of achieving "substantial further progress" towards its goals of achieving maximum employment and price stability before setting off any policy changes. But with the labor market recovery ramping at a solid clip and prices surging across various pockets of the economy, investors have been left to contemplate whether a tapering signal from the Fed may come sooner rather than later.

"I think the Fed has got a problem on its hands because clearly inflation has gone well beyond what Richard Clarida and other Fed members said about a year ago," Robert Dye, Comerica Bank Chief Economist, told Yahoo Finance. "They said they might tolerate inflation in the 2, 2.5% range. And we got the CPI [consumer price index] print at 5% year-over-year ... And I think the Fed has got a lot of pressure on it to define or clarify or say something other than inflation is transitory, because inflation has been here for a while."

Still, however, markets this week have suggested they are not overly concerned with the prospects of a near-term hike to interest rates, with near-zero rates having served as another key component of the Fed's crisis-era toolkit. The benchmark 10-year yield has come down by nearly 30 basis points from a March high, and technology and growth stocks have resurged to power the Nasdaq to a fresh record level.

"I would say that we're seeing the effect of the somewhat lower interest rates," Cheryl Smith, Trillium Asset Management, told Yahoo Finance. "The 10-year Treasury's gone down quite a bit and those longer duration big tech names are benefitting form it. I think the sentiment is getting more clear that the Fed is not going to start raising interest rates on Wednesday or the next meeting, or the next meeting after that. So it's really a reaction and a relief." "

MY COMMENT

Data comparing the current situation to the peak of the pandemic a year ago....is MEANINGLESS. that is why the Producer Price Index is not going to matter. PLUS....it is already FULLY baked in.

The FED.....no....they are not going to do anything. Of course...as usual...there is a chance they will say something STUPID.....or.....use some language that can be misinterpreted. BUT....does anyone really think they are going to announce anything this week? I severely doubt it. SO.....we will simply continue with the current market situation......BORING, LINGERING, and SCARED.....for the rest of this week. All things being equal....we should end the week with positive returns for the Market Indexes.......at least for the SP500, the NASDAQ, and the NASDAQ 100.

 

Considering the current environment....the markets today are doing EXACTLY what you would expect. Here are the......short term.....stories of the day that are driving the markets by the....micro-second.

Stock market news live updates: Stocks pull back from record highs after retail sales miss, inflation data rises

https://finance.yahoo.com/news/stock-market-news-live-updates-june-15-2021-223143155.html

MY COMMENT

No need to even discuss this data. It is just about as expected.....and.....there is nothing I can add to the page after page after page of discussion on here about the FED and the inflation data. In my view the ACTUAL news of the day.....

The first state to shut down due to Covid-19 reopens today

https://www.cnn.com/2021/06/15/us/california-reopening-15th/index.html

At last we will HOPEFULLY see the entire West coast open back up. Sooner or later we will see the Mid-West and the rest of the East coast open back up.....fully. At that point we will be within about 6-12 months of a fully open and fully functioning economy. Of course......big business NEVER closed at all. It was small business and those with no power that got shut down and hammered by this process. We need to QUICKLY MOVE FORWARD......and.....hopefully learn some lessons from this little adventure.

 

Here is the TRUTH.....in a nice little article.

Lumber is showing us the future

https://finance.yahoo.com/news/lumb...e-morning-brief-100513368.html?.tsrc=fin-srch

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

"Two months ago it took only one thing to be rich.

And that was a piece of lumber.

Through the spring, the surge in lumber prices became the market narrative as it covered every pandemic-related trend: Labor shortages, shipping constraints and housing demand — all in one place.

But now it looks like the latest mini-bubble to hit the market has started to pop, and offers us a preview of what's to come across the economy.

On Monday, the lumber futures contract traded back below $1,000 per thousand board feet for the first time since late March. A level that is still elevated to be sure, but back in line with pandemic-era peaks seen in late summer 2020, and the early winter of 2021 (before the spring's epic short squeeze).


Lumber futures are down almost 40% from their record high hit in mid-May as the latest mini-bubble within the economy cools off. (Source: Yahoo Finance)
During the housing bubble, the futures contract for random length lumber never traded above $500 per board feet. But by early May, lumber futures were trading hands for more than $1,600 per board feet. This surge was adding as much as $36,000 to the cost of a new home; on average, new homes sell for around $400,000.

So while Cathie Wood may have become the face of the pandemic stock market rally, actual wood had become the market's hottest trade.

We've called this recovery the "not enough" economy as demand for almost everything — workers, vacations, dinner reservations, and so on — outstrips supply. Another way to slice this narrative is, as Bloomberg's Joe Weisenthal has argued, to call this an economy facing a series of short squeezes.

Used car prices, for instance, have been ripping higher as demand rises and supply is constrained. The used car market is, in essence, facing a short squeeze.

So too is the global shipping market, as Insider's Rachel Premack outlined in a piece last week. And on the housing side, economist Ali Wolf told Bloomberg recently there's been something of a "buyer's protest" in the market as prices for single-family homes in the U.S. have exploded over the last year.

But each of these markets — autos, shipping, housing, among others — has become imbalanced, because of one-time surges related to a dramatic and synchronized shutdown, and then re-opening the world's largest economy.

When the Fed says inflation pressures will be "transitory," what they mean is that prices across each of these categories facing short squeezes right now will start to make more sense. It just so happens that lumber is just showing us the way. "

MY COMMENT

YES....lumber is showing the way. These price disruptions are going to rumble.......randomly.....through the economy for the next 6-12 months. This is simply the price we will pay for the closing of the economy....especially...the small business and manufacturing economy. Like everything........it WILL pass....we will move on to other topics and other issues in the business and investing world. It will take a while....but it will happen....we will move on.

The NICE thing is......through much of this re-opening process investors WILL make money....as usual.

 

I looked at my account a while ago. A sea of red.....as expected on a news day like today. I had one stock UP at that time.....PG....which was UP about 20 cents per share. The nice thing was the losses were very shallow and not anywhere close to ERASING the gains I got yesterday. I think we were are maximum DOOM for the day at and just after the open. The rest of the day will be interesting to see if there is somewhat of a come-back as the day and investors move on. Of course....we have the BIG FED proclamations tomorrow......so that is also a factor today.

Short term.....we are just going to have to put up with the erratic day to day and week to week markets.....no big deal.

AND.....HEY....at least bitcoin is back near $40,000 for those that own it or trade in it. Not that it matters to most investors. I mention it as a bit of the news of the day.....NOT....because I have any interest in it as an investment.

 

Here is another positive indicator.

CEO optimism nears all-time highs: survey

https://finance.yahoo.com/news/ceo-optimism-nears-all-time-highs-survey-150325603.html

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

"CEO optimism is nearing record highs, according to Business Roundtable’s quarterly CEO economic outlook survey released on Tuesday. The group's economic outlook index increased in the second quarter to 116 — up nine points from the first quarter and just two points below the all-time high in early 2018.

The Business Roundtable index showed the executives’ plans for hiring, capital investment and sales all increased in the second quarter — with plans for hiring over the next six months reaching historically high levels. The group surveyed 172 CEOs between May 25 and June 9, 2021.

“CEO optimism near historic highs, particularly with record hiring plans, is a strong sign that we are climbing out of this unprecedented crisis," said Doug McMillon, Walmart CEO and Business Roundtable Chairman.

"By continuing to encourage more Americans to get vaccinated, we can ensure a continued safe reopening in the short term, and a stronger and more equitable economy in the long term," he added.

Seventy-five percent of CEOs say conditions for their companies have already bounced back to pre-pandemic levels or will recovery by the end of the year — up 2 percentage points from the previous quarter. A quarter of chief executives don't expect business conditions to recover until 2022 or later.

The group, which is made up of CEOs of the nation's largest companies, encouraged lawmakers to build on the economy recovery by passing a bipartisan infrastructure bill, but warned against raising taxes.

"Proposals to increase corporate tax rates would have significant adverse effects on hiring and investment plans and would be counterproductive to the goal of greater economic growth and opportunity for all Americans," said Gregory Hayes, Raytheon Technologies Chairman and CEO and Business Roundtable Tax and Fiscal Policy Committee Chair.

The CEOs predict 5% growth for 2021, a 1.3 percentage point increase from their estimate of U.S. GDP growth last
quarter."

MY COMMENT

THIS data is something that ACTUALLY might have some.....predictive value....for investors. Being a BIG CAP GROWTH type investor.....for the long term....this attitude is good news. At least this survey is reflecting the attitudes and knowledge of ACTUAL....business people. Boots on the ground.

 

As expected.....red today. And...got beat by the SP500 by .36%.

I had a single green holding today.....COSTCO.

ONWARD......to a new day and a new chance to make some money.

 

I like this little article and the positive message for investors.

Here are 7 reasons to stay bullish on stocks and why the S&P is headed to 4,600, from Credit Suisse

https://finance.yahoo.com/m/8fb067c8-f9b6-30ee-be60-023fa936a8e2/here-are-7-reasons-to-stay.html

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

"Investors continued to sweep away those inflation worries at the start of the week, sending the S&P 500 SPX, -0.20% and the Nasdaq Composite COMP, -0.71% to fresh highs. That’s a decent feat for the latter, which last hit a record on April 26.

Markets simply believe it is too soon for a Federal Reserve taper, as the central bank’s two-day meeting kicks off Tuesday. According to Bank of America’s latest monthly fund manager survey, 72% are buying the Fed’s line that inflation is transitory.

That doesn’t mean some investors aren’t still worried about this, that and the other. Our call of the day comes from Credit Suisse’s chief U.S. equity strategist Jonathan Golub, who offers reasons to stay bullish.

“Surprisingly, we find investors more bearish as inflation readings and declining yields dominate conversations,” he said in a note to clients that published on Monday. “Despite these issues, we remain comfortable with our 4600 [S&P 500 SPX, -0.20% ] year-end price target, which implies 8.3% upside.”

So here’s Golub debunking a few current investor concerns (in bold), with charts to back it up:

1. Inflation readings such as last week’s on consumer prices and higher commodity prices could begin putting profit margins under pressure. “Our work indicates that companies are experiencing substantial pricing power which should lead to greater profitability despite higher input costs,” countered Golub.



Credit Suisse
2. Some Fed officials have hinted of a readiness to start discussing tapering asset purchases, while rate-hike expectations have inched forward. In a review of rate increase cycles in 1994, 1999, 2004 and 2015, the bank found that returns were robust 12 months ahead of, and 36 months after the first rate increase, weakening only when the yield curve flattens.


Credit Suisse

3. Signs of declining bond yields in the face of higher prices could mean stagflation is looming. That is unlikely, with inflation largely seen as transitory and 10-year Treasury yield rate declines modest (5-year range 0.5% to 3.2%), said Golub.

4. Economic surprises have steadily fallen since mid-July, but the market keeps going up. Economic activity has improved during this time, and that is the “true catalyst of the S&P 500’s advance,” the strategist argued.



Credit Suisse
5. Growth and earnings per share, both running high, could be about to roll over. “While the pace of improvement is sure to moderate, growth is projected to remain well above trend through the end of 2022,” said the strategist.


Credit Suisse
6. While fiscal and monetary policy kept economies running throughout the COVID-19 pandemic, further help looks unlikely. “While further stimulus appears less likely (or will be reduced), we are less concerned given (1) an overheating economy; (2) less immediate impact of plan; and (3) higher accompanying taxes,” said Golub.""

MY COMMENT

I only count six...which I labeled with numbers 1-6. Sounds good to me. It is ALL going to be about a BOOMING ECONOMY and GREAT business earnings going forward. I think all the negativity is just SILLY.