The Long Term Investor

NOT an earth shattering day for me today.....but....I STILL made moderate money...enough that I am satisfied. It was enough to push me to another ALL time personal high. So I was green today.....even though the SP500 beat me by 0.08%. My RED stocks today were AAPL, AMZN, MSFT, COST, and HD. My other 5 holdings were ALL green and made more than the losses in those 5 stocks.

SO.....a nice start to the week. It looks like the BIG CAP GROWTH stocks are going to.....LINGER....their way into earnings.

 

I GUESS I have been REALLY LUCKY in the stocks that I have bought and held over the past 40+ years.

An Investing Truth: Roughly 80% of Stocks Are “Duds”

https://www.riskhedge.com/outplacement/an-investing-truth-roughly-80-of-stocks-are-duds1/rcm

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

"Today I’m spilling the beans on something very important. It’s a “truth” about investing almost nobody understands. This truth explains why most investors struggle to make any real money in the stock market… while a few achieve life-changing gains.

The truth is: most stocks are horrible investments. Let me show you what I mean, and how you can turn this truth into an edge that’ll let you beat 99% of investors.

This truth Has Been Fooling Investors for Centuries
About 150 years ago, whaling was one of America’s most important industries. Electricity hadn’t been invented. To light up streets and homes at night, folks burned highly flammable whale oil.

By 1850, whaling was America’s fifth-largest sector, and it paid extremely well. Just a few thousand whalers earned the modern-day equivalent of $27 billion in one year. But most voyages never made a dime.

A few years ago, Chicago University researchers wrote a book about the US whaling boom: In Pursuit of Leviathan. They analyzed 4,000+ voyages and found one-third of whalers actually lost money. And get this: the top 1.7% of whalers generated almost all the returns.

What if I told you the same is true in modern-day investing? Look at the venture capital (VC) industry, for example. Most venture-backed startups fail. A small portion do okay. But only a handful turn into multibillion-dollar winners.

In the book VC: An American History, Tom Nicholas compared VC returns over the past few decades to whalers 150 years ago. And they look eerily similar. Roughly one-third of funds lost money, and only a tiny fraction hit it out of the park—as you can see here:


Source: VC: An American History.

Tons of losers and a few big winners.

The US Stock Market Follows the Same Pattern
JP Morgan Asset Management recently published a great paper called Agony & Ecstasy. It’s a deep dive into the performance of the US stock market over the past 40 years. And it confirmed an important investing truth: most stocks are “duds.”

JPMorgan found almost half of stocks suffered a “catastrophic loss” from 1980 to 2020. Meaning they plunged 70%+ and never recovered. Another 26% of stocks handed out returns lower than the overall market.

In other words, roughly eight in 10 stocks were total duds that cost investors’ money. But you surely know the US stock market is a lot higher than it was forty years ago.

How is that possible when eight in 10 stocks are losers? Turns out, all of the market’s returns came from just 10% of stocks, which JPMorgan called “megawinners.” In short, this elite group of stocks performed so well, they pulled the entire market up with them.

Whether you’re measuring 19th-century whaling, early stage startups, or large stocks, you can’t escape this investing truth. Lots of losers and a few big winners.

In short, the odds are stacked against investors from the start. It’s no wonder most stock market investors struggle to even keep up with inflation. This is why picking individual stocks isn’t for everyone. In fact, many folks are better off owning a broad basket of US stocks or buying indexes.

By simply owning the S&P 500 ETF (SPY), you would have doubled your money over the past five years. That’s a good, stress-free option. But investors who really want to get rich have to hunt for “megawinners.”

Here’s How to Find These Elite Stocks
It’s a lot easier once you know what to look for. Here are the top performing large US stocks over the past ten years:



These megawinners aren’t all household names. But most of them share one key trait: They are disruptors. Longtime RiskHedge readers know disruptors are companies that change the world and invent the future. Take a quick look at the top three megawinners.

Tesla rocketed to the top of the list by pioneering affordable electric cars. Repligen invented machines pharma companies use to make life-saving drugs. And America’s largest chipmaker, Nvidia, is the “brains” behind the most important artificial intelligence (AI) projects in the world today.

As you can see, it’s a lucrative strategy to invest in companies pioneering whole new industries and transforming old ones. The above list shows businesses that achieve these feats routinely turn out to be megawinners, and can hand you 1,000%+ gains, or sometimes a lot more, over the course of a decade.

For example, I made a big call back in 2018. I said if I could only buy one stock for the next five years… it would be Nvidia (NVDA). The stock has more than doubled since then:



Why did I choose Nvidia? It ticked all the boxes to be a megawinner. The disruptive chipmaker almost single handedly revived the dream of creating artificial intelligence (AI) with its revolutionary chip called the GPU.

Not only are these chips responsible for the real-life video game graphics we have today, these gaming chips are perfect for training machines to “think” like humans. This breakthrough has helped Nvidia grow its AI-related data center sales 1,850% over the past five years. Remember, disruptive megawinners routinely pioneer whole new industries. This allows them to grow uninterrupted year after year.

Nvidia’s stock has handed out 14x gains over the past five years. So next time you think about buying a stock, remember the truth: Most stocks are bad investments. If you want to get rich investing, you must own the “megawinners.”

MY COMMENT

DONT become a.......whaler. AND.....I REALLY dont buy the view that you have to look for and find the MEGA-WINNERS. I do believe.....MOST......of what I highlighted above.

My view is the way you achieve this.....and.....avoid all the many losers is by rational LONG TERM investing in either the CREAM OF THE CROP of the BIG CAP AMERICAN company world.....or....simple Index investing....like the SP500. I have stated many times on here what I look for in an individual stock. What I want is an AMERICAN business that is a.....BIG CAP, DOMINANT COMPANY, WITH ICONIC PRODUCTS, THAT ARE MARKETED WORLD WIDE, WITH A VIRTUAL MONOPOLY, WITH GREAT GROWTH PROSPECTS, WITH GREAT MANAGEMENT.

That is it....not much to ask for there. If I achieve a small.....10-15.....stock portfolio that is focused on these sorts of companies.....and....I follow the FUNDAMENTALS.....over the long term....I will achieve WEALTH. As an alternative....I can do the same thing by owning the SP500 Index.

It is very easy to say this.....it is VERY difficult to achieve. The greatest hazard and danger to such a strategy....the HUMAN BRAIN. Like EVERYTHING in life....doing the SIMPLE thing.....is just about impossible for most people.

 

HI....Mb0....and welcome...please feel free to post your experiences on here. New posters are ALWAYS welcome.

You asked about NVIDIA and the recent gains:

"Do you see this increasing?"

WELL the answer is in the fact that I hold the company as a LONG TERM holding........and......will continue to do so. For me.....long term means.....at the minimum 3-20 years. I believe this company is SET UP to continue as the DOMINANT company in its business area, including AI and gaming as well as the EV business.

If you are asking about the gains since May 21, 2021 during which time the stock has SKYROCKETED......no I dont expect it to continue at this rate. In fact....I would not be surprised to see the shares drop back some after the split. AND....over the longer term the company stock will be very erratic and move up and down as it ALWAYS has. There is MUCH analysis of this stock available on-line for you to look at. Many people are STILL strongly recommending the company to potential buyers.

I dont make investing recommendations on specific companies since I dont know anything about your experience or finances.....but I encourage you to read the MOUNTAIN of information that is out there on this stock.

This company is one of my 10 stock holdings in my.....LONG TERM....portfolio and the stock accounts that I handle for ALL family members.

 

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 10 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
Nvidia


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 ten 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.

 

WELL....big surprise again today. I expected to be about flat in my account. BUT...when I just looked I was STRONGLY in the green. My red stocks....so far today......are NIKE, NVIDIA, Home Depot, and Honeywell. All of the red stocks except for NVIDIA are......only in the red by a slight amount. Nvidia is red by about $6.60 or about 0.80%.

So all in all....a great start to the day.

 

HERE is what we are seeing so far today. It seems like a typical open....as usual....except for the fact that we have some big bank earnings on top of the typical WEAK non-directional open. I HATE the first couple of weeks of earnings with all the banks reporting. They usually set a BLAH tone for the earnings....even if their data is good. Banks and financials are.....one of the categories....of business that I TOTALLY IGNORE and will not buy.

Stock market news live updates: Stocks mixed, S&P 500 rises to record high after inflation data tops estimates

https://finance.yahoo.com/news/stock-market-news-live-updates-july-13-2021-221624018.html

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

"U.S. stocks were mixed Tuesday, with the S&P 500 back at a record high as investors monitored an early batch of corporate earnings results. Inflation was also back in focus and new data showed consumer prices surged by the most since 2008 in June.

The S&P 500 shook off earlier losses to briefly touch a record intraday high. The Dow and Nasdaq fluctuated between gains and losses after setting record closing highs a day earlier. The choppiness came after a hotter-than-expected print on consumer price inflation Tuesday morning. The Labor Department's headline consumer price index rose 0.9% in June over the prior month, unexpectedly accelerating from May's 0.6% rise. Over last year, the CPI was up 5.4%, also exceeding the 4.9% increase expected and coming in at the fastest pace since 2008. And excluding more volatile food and energy prices, CPI was up 4.5% in June over last month, comprising the biggest jump since 1991 as prices bounced off last year's pandemic-depressed lows.

Earnings out Tuesday morning, meanwhile, were mixed. PepsiCo (PEP) shares gained in early trading after the food and beverage giant delivered a strong earnings beat and raised its outlook for the full year. Meanwhile, JPMorgan Chase (JPM) posted mixed results that sent the stock lower, with weaker-than-expected fixed income sales and trading revenue and managed net interest income overshadowing a better-than-expected overall adjusted revenue and earnings per share.

S&P 500 earnings in aggregate are expected to grow by 64% for the second quarter, which would mark the fastest increase since the fourth quarter of 2009, according to FactSet data. Bank earnings especially were expected to show strength, buoyed by a wave of reopenings during the April through June quarter and an equity market trading at all-time highs.

The pace of growth for the second half of the year will be closely watched in company guidance, given the potential for a deceleration after an initial reopening surge. And with input costs rising and labor scarcities still weighing on the economy and pushing inflation higher, margins across industries will also be closely in focus.

"If this idea happens and inflation rises, that's actually a very good thing for your banks," Courtney Dominguez Payne Capital Management senior wealth advisor, told Yahoo Finance. "So I think that can be a really good way of playing this going forward, where you want to look at companies that are going to benefit from either interest rates rising or who have just some pricing power here, that they are able to raise their costs effectively for their consumers and continue to make that money going forward."

11:15 a.m. ET: Three factors are propping up equity markets: MKM Partners
With markets at record levels, equity traders have already priced in much of the good news around corporate profit growth for the second quarter, according to at least one pundit.

"The earnings cycle has been jaw-dropping, historic, unprecedented. But it's also largely behind us, and the equity market largely reflects it. We've seen a boom in equity prices over the last year plus, almost like we've never seen before," Michael Darda, MKM Partners chief economist, told Yahoo Finance. "So I think the discussion going forward is, what is propping up equity prices: The earnings story for sure, high liquidity and low discount rates. So the threats to the market going forward would be that one of those three legs of the stool ends up getting kicked out."

"I would warn against the areas that have been recently outperforming that carry quite high valuations — an incredibly dangerous place to be at the moment," he added.

10:32 a.m. ET: 'We're facing not peak growth in level terms, but peak growth rate': CIO
One of the biggest questions facing investors following a massive reopening surge has been how quickly economic and corporate profit growth rates will moderate. According to at least one strategist, growth is set to continue, but a pullback in the pace of these expansions is inevitable.

"I do think we're facing not peak growth in level terms but peak growth rate — both for the economy and earnings," Liz Ann Sonders, Schwab Center for Financial Research chief investment strategist, told Yahoo Finance. "And that's just simply the base effects from the second quarter of last year. And I think CEO confidence, which is highly correlated to corporate profitability, is tied t o that, given that Refinitiv expectations has second quarter year-over-year earnings growth for the S&P now approaching 70%. But the likelihood is that the peak is there."

8:33 a.m. ET: Core consumer prices jumped by the most in three decades in June, beating estimates
The Labor Department's June consumer price index (CPI) increased at a faster-than-expected rate both over last month and last year, with price increases getting exacerbated by persistent supply chain disruptions and labor scarcities during the pandemic.

Headline consumer prices rose 0.9% in June over May, accelerating from May's 0.6% monthly increase and coming in faster than the 0.5% monthly rise consensus economists were expecting, according to Bloomberg data. Over last year, CPI rose 5.4% versus the 4.9% increase anticipated, marking the biggest rise since 2008.

Much of the rise in CPI came as used car prices climbed further, with these. gaining 10.5% in June to account for more than one-third of the total rise. Indices tracking food and energy prices also gained by 0.8% and 1.5%, respectively.

The core consumer price index, which excludes food and energy prices, rose 4.5% over last year in June, also beating estimates for a 4.0% increase. This marked the fastest rise since 1991.

7:42 a.m. ET: Goldman Sachs second-quarter results top expectations, fueled by investment banking, wealth management
Goldman Sachs (GS) posted results that mirrored those of peer big bank JPMorgan Chase, topping consensus estimates overall on the top and bottom lines, but missing expectations on closely watched trading results.

The bank's net revenue of $15.39 billion grew 16% over last year and beat estimates for $12.43 billion, according to Bloomberg consensus data. Earnings per share of $15.02 were also well above the $10.15 expected. Net interest income, derived from the bank's core lending business, grew 73% over last year to $1.63 billion.

Beneath the headline results, however, some business areas performed less strongly. Trading revenue overall was down 32% to $4.9 billion, missing estimates for $5.02 billion. Fixed income trade revenues led the drop, with these plummeting 45% over last year to $2.32 billion. Equity sales and trading revenue also fell over last year by 12% to $2.58 billion, though this topped estimates. Investment banking revenue was a strong spot amid a busy IPO period earlier this year, growing 26% to $3.45 billion. And consumer and wealth management sales were $1.75 billion in the second quarter for a rise of 28% over last year.

“Our second quarter performance and record revenues for the first half of the year demonstrate the strength of our client franchise and our continued progress on our strategic priorities," CEO David Solomon said in a statement. "While the economic recovery is underway, our clients and communities still face challenges in overcoming the pandemic. But, as always, I am proud of the dedication and resilience of our people, who have worked tirelessly to help our clients navigate the ever-changing market environment.”

7:20 a.m. ET Tuesday: JPMorgan Chase posts mixed second-quarter results
JPMorgan Chase kicked off big bank earnings on a mixed note Tuesday morning, posting overall quarterly sales and profits that topped estimates while key business segments came in slightly short of consensus expectations. Still, CEO Jamie Dimon struck an upbeat tone on the health of consumer spending in the recovering economy, noting, "Consumer and wholesale balance sheets remain exceptionally strong as the economic outlook continues to improve."

The largest U.S. bank by assets posted earnings per share of $3.78, topping estimates for $3.15, according to Bloomberg consensus data. Likewise, adjusted revenue of $31.4 billion was better than the $30.06 billion anticipated.

The company's lucrative fixed income sales and trading revenue fell 44% over last year to $4.10 billion, or just a tick below the $4.12 billion anticipated. Equity sales and trading revenue still grew 13% over last year to an estimates-topping $2.69 billion, however, with a market rally to all-time highs during the quarter helping boost results. And in terms of bottom-line results, managed net interest income of $12.85 billion was also down 8% and missed estimates."

MY COMMENT

Those are some PRETTY BIG trading misses by both of the above banks. I guess they were NOT able to JAWBONE the interest rates on the Ten Year Treasury and other instruments in their favor the way they wished a few months ago. BUMMER...for them.

The banks dominating and setting the tone for earnings drives me crazy. The always do well but they also always miss in some way. They just seem to create NEGATIVE ENERGY for the market in my view.

We are SO FOCUSED on the EXTREME earnings estimates that were HYPED by the financial media for the past few weeks that we are all set up for NOTHING to happen over the coming weeks with the markets. The expectations are so HUGE that the reality can not meet them.....even though earnings WILL be historic.

 

I have to put up a NVIDIA count-down post even though it is not doing much today.

AFTER today we have......FOUR.....days till the 4 for 1 split happens. It is way too early in the day today to have any clue how it will close. I believe there is STILL a significant CHANCE for a positive close today....but that is simply a GUESS. The bank earnings this week and all the talk about CPI and other issues are......OVERSHADOWING......the split. At this rate there will be NO BUZZZZZ connected to the upcoming split.

I am day to day on when I will simply take my profit on this little 35 share trade......but for the moment......I am planing to hang in there till the day after the split.

 

The RALLY that we have ALL been experiencing in our accounts for the past 4-5 weeks is STILL holding....very nicely. Definitely a STEALTH RALLY. I suspect that if you asked the......average person.....how stocks are doing they would have no clue and would lean toward the negative. They would be all concerned about INFLATION.....the virus.....and all the other topics that are fear mongered by the non-financial media all day long.

Personally....that is a good thing. We need to keep the EXUBERANCE....rational......and under the table. This WILL prolong the rally.

The re-opening is still having a difficult time. As expected. Opening an entire economy....especially distribution channels and employment in the face to contradictory government policies is a difficult thing. Lumber is WAY DOWN as are some of the other items that were being HYPED earlier. We are going to be in a time period where there is a danger of shortages due to commercial HOARDING for months to come. JUST the reality of the distortions and disruptions of getting the economy back up and operating normally.

 

I just took my last look at my account till the close and NIKE has now gone green......so I am at....7 of 10 positions positive. A good start to he day....LETS build from here.

 

gtrudeau88

You are doing very nicely. AND...in managing your own account...you can always add some of those mutual funds that you had under your former financial advisor.....or similar funds....if they look like they are going to continue to outperform. At least you would not have the advisor fees.

BUT...you are doing very well.....no reason to start to jump around based on the short term. NOTHING wrong with a return of 15% half way through the year.

 

Welcome to EARNINGS. They are NEVER big enough...never good enough......to satisfy the NIT-PICKERS. It just becomes an exercise in frustration as companies report GREAT earnings and than......their stock goes down. That is how it has been for years now.....and....it will probably happen this time.

Stock market news live updates: Stocks turn lower after hitting intraday records amid earnings, inflation data

https://finance.yahoo.com/news/stock-market-news-live-updates-july-13-2021-221624018.html

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

"U.S. stocks fell to reverse course on Tuesday, with the S&P 500 pulling back from a record high as investors monitored an early batch of corporate earnings results. Inflation was also back in focus and new data showed consumer prices surged by the most since 2008 in June.

The S&P 500 briefly touched a record intraday high before dipping into the red. The Dow and Nasdaq also declined.

The choppiness came after a hotter-than-expected print on consumer price inflation Tuesday morning. The Labor Department's headline consumer price index rose 0.9% in June over the prior month, unexpectedly accelerating from May's 0.6% rise. Over last year, the CPI was up 5.4%, also exceeding the 4.9% increase expected and coming in at the fastest pace since 2008. And excluding more volatile food and energy prices, CPI was up 4.5% in June over last month, comprising the biggest jump since 1991 as prices bounced off last year's pandemic-depressed lows.

Earnings out Tuesday morning, meanwhile, were mixed. PepsiCo (PEP) shares gained in early trading after the food and beverage giant delivered a strong earnings beat and raised its outlook for the full year. Meanwhile, JPMorgan Chase (JPM) posted mixed results that sent the stock lower, with weaker-than-expected fixed income sales and trading revenue and managed net interest income overshadowing a better-than-expected overall adjusted revenue and earnings per share.

S&P 500 earnings in aggregate are expected to grow by 64% for the second quarter, which would mark the fastest increase since the fourth quarter of 2009, according to FactSet data. Bank earnings especially were expected to show strength, buoyed by a wave of reopenings during the April through June quarter and an equity market trading at all-time highs.

The pace of growth for the second half of the year will be closely watched in company guidance, given the potential for a deceleration after an initial reopening surge. And with input costs rising and labor scarcities still weighing on the economy and pushing inflation higher, margins across industries will also be closely in focus.

"If this idea happens and inflation rises, that's actually a very good thing for your banks," Courtney Dominguez Payne Capital Management senior wealth advisor, told Yahoo Finance. "So I think that can be a really good way of playing this going forward, where you want to look at companies that are going to benefit from either interest rates rising or who have just some pricing power here, that they are able to raise their costs effectively for their consumers and continue to make that money going forward."

1:23 p.m. ET: Stocks trade mixed, S&P 500 turns negative
A choppy session continued Tuesday afternoon as the S&P 500 erased earlier record-setting gains to turn negative. The information technology, consumer staples and communication services sectors outperformed despite the drop in the broader index, while the financials, real estate and materials sectors lagged."

In the Dow, Boeing and JPMorgan Chase were the laggards, with the latter stock reversing course after a strong rise on Monday. Apple and Microsoft were the two best-performers, however, as growth and technology shares were bid higher."

MY COMMENT

If earnings are so great nothing can be criticized....than....they will nit-pick the forward looking statements. It is always something.

Meanwhile.....actual investors....just plug along as usual....day by day...making money over the medium to long term.

 

I was doing pretty good when I looked about 15 minutes before the close....."pretty good" being just a SMIDGE into the red. Now....way worse...as the markets took a hit during the last 15 minutes of the day. No confidence or guts in the markets today....at all. I ended in the red by a bit......but....I managed to beat the SP500 by 0.13%. that is about the best I could do.

I had ONLY 3 of 10 positions in the green at the close.....AAPL, MSFT, and GOOGL.

 

A handful of earnings tomorrow as the banks and financials continue. Delta Air, Bank America, Citigroup, Wells Fargo and Schwab.

I dont own or follow any of them....at all. But....baring some news item....I expect that the day will be a repeat of today....with a WIMPY open and little to no willpower to do anything much. That does not mean it will be another down day....it just means it will lack CONVICTION......and.....the end result will be up in the air......as usual lately.

It will be the TYPICAL battle between the actual earnings and company results and the financial news FEAR MONGERS.

 

Looks like I am in good company with my CONSTANT harping on DEFLATION.

ARK Invest's Cathie Wood looks past rising consumer prices to focus on deflation

https://finance.yahoo.com/news/ark-invests-cathie-wood-looks-191510356.html

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

"NEW YORK (Reuters) - Deflation will likely become a larger force in financial markets in the year ahead despite the recent spike in consumer prices to 13-year highs, star stockpicker Cathie Wood of Ark Invest said in a webinar on Tuesday.

U.S. consumer prices increased by the most in 13 years in June due in part to supply constraints, the Labor Department said on Tuesday.

Wood, whose Ark Innovation ETF was the top-performing U.S. equity fund tracked by Morningstar last year, said technological innovation would continue to push down prices significantly.

"The message we continue to pound the table on is that nominal GDP growth, because of these deflationary forces, will be surprisingly low," said Wood.

As a result, 10-year Treasury yields will likely stay below 3% for the foreseeable future, pushing up the broad valuation of the U.S. stock market, she said.

"I believe the bond market is in a bubble," Wood said, adding that "too many people are afraid of inflation" which is a "killer" for stock market valuations.

Any further rallies in oil prices will likely lead to a sharper sell-off in the future as demand withers and more consumers opt for electric vehicles, Wood said.

"We would not be on the long side of oil," Wood said.

ARK remains bullish on the online betting market and estimates that the U.S. market will grow from $9.5 billion to $37 billion by 2025. The fund has a position in DraftKings Inc, which is up 7.2% for the year to date.

Wood's $23.6 billion ARK Innovation ETF suffered steep declines earlier this year as investors rotated away from growth and technology stocks to more cyclical sectors such as financials and energy. But it has gained 7.4% over the last month as Treasury yields edge lower.

The fund is up 0.2% for the year, a performance that puts it in the bottom 98th percentile of the 595 U.S. mid-cap growth funds, according to Morningstar data."

MY COMMENT

Welcome to the club. Just about EVERYTHING I see is an indicator of deflation. The continued MASSIVE importation of skilled and unskilled workers from the third world......the march toward EU style Socialism, or worse......the move to work from home, in other words outside the USA........the massive tech innovations over the coming years which will DEVASTATE employment....the world being stuck in a deflationary depression for the past 12+ years.......the continued push for GLOBALISM......the early steps being taken right now to create a world tax system......etc, etc, etc.

THANK GOODNESS....I am not a worker. Like any massive economic transition....it is not going to be pretty for many, many, people.

The GOOD NEWS for investors...there will be GREAT POTENTIAL to make big gains....as companies ramp up productivity.....and fundamental results....by SEVERELY REDUCING the number and expense of employees. For me....it is NOT personal....it is not up to me as an investor to like or dislike what is going to happen......it is up to me to make money from whatever it is. So......what the hell....bring it on.

 

That is pretty good advice for college age people. YES......to all of them.

I would add.....if you major in liberal arts or whatever....at least try to get a minor in Business or Economics, it will help a lot to promote yourself when job hunting.

Economics is a good alternative to Business in many schools and often much easier to get into as a major. One of my kids went to a school where it was nearly impossible to get into the Business department.....so...... many kids went the route of Economics as an alternative with a smattering of Business classes or a Business minor.

AND.....really, really,....watch what you post on social media.

Pick a school that matches up well with you and your strengths. It may not be the TOP school, but a GREAT GPA from a good school is better in many cases than a so-so GPA from a top school.....if you are considering grad school or med school, law school, etc, etc. It will also be easier to get into some programs at a good school......compared to the BIG school where the number of spaces in Business, etc, etc, are very limited.

That college degree is your GOLDEN TICKET to get in the door for many jobs....but....it just gets you in the door. After that it is up to you to bootstrap that first job into a career.......somewhere.....probably not at that first employer.

AND....have some fun.

 

That is a good topic Oldmanram. Aimed at one of your kids?

Anyone else have any advice to college students or those that are going to graduate soon?