The Long Term Investor

HELLO....TireSmoke. Good to have you actively posting.......the more the better.

Actually....I dont have any issue at all with your investment plan. It is similar to what I do....but spread over your two portfolios. On one hand you have your 401K with the SP500 Index....on the other hand you have your brokerage account with your four stocks. Similar to my.....just under half of my account.....in the two funds and the rest.....just over half the account....in my ten stocks.

AND.....I am personally NOT a fan of the massive diversification that people tend to use today......thus I only own 10 stocks. too much diversification is a return killer.

You are going to make a FORTUNE over the next 30+ years. You discovered the SECRET to investing........long term holdings and the power of compounding....... at a relatively early age. Congratulations. I ALSO strongly use the power of....letting winners run.

 

ZUKODANY.......no I have not noticed much of a change in our spending lately. We use the same budget every month and have for years. Everything seems pretty normal. Our electric, gas, and water bills are the same as always. Gas for the cars is a bit higher....averaging about $2,75 per gallon.

 

HERE....is some MINOR stuff to watch for this coming week. I dont see anything shocking in the week ahead.....should be a repeat of this week.....but....hopefully minus the tragedy in Afghanistan.

August jobs report, Consumer confidence: What to know this week

https://finance.yahoo.com/news/augu...fidence-what-to-know-this-week-202216254.html

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

"New data on the U.S. labor market will be in focus this week, offering an updated look at how economic activity has been impacted as the spread of the Delta variant ramped up in the U.S. over the summer.

The Labor Department's August jobs report will be the marquee economic report out this week. Consensus economists expect to see that a still-robust 750,000 jobs came back in August, according to Bloomberg data. This would represent a significant print by pre-pandemic standards, but still mark a deceleration from July's increase of 943,000 jobs. The unemployment rate likely improved further, reaching 5.2% from the 5.4% reported during July.

The August jobs report is set to be an especially telling report, capturing the impact of the latest surge in coronavirus cases on the U.S. labor market. Other recent economic reports already began to reflect the Delta variant impacts on activity: Job creation in the U.S. services sector slowed by the most since February, while manufacturing sector workforce numbers increased by the least since last year, according to IHS Markit's latest purchasing managers' index reports.

"High frequency labor market data are signaling a marked slowdown in employment activity in the August payroll survey week, suggesting downside risk to our forecast," Bank of America economist Michelle Meyer wrote in a note on Friday, adding that she expects non-farm payrolls to grow by just 600,000 for August.

"Our below-consensus non-farm payrolls forecast is predicated on the markedly weaker high frequency employment data between the July and August payroll survey periods," Meyer added. "Specifically, the Homebase and UKG employment series were both down 3.4% and 2.4%, respectively, over the month."

The outcome of the August jobs report will also be another closely watched data point informing the Federal Reserve's next moves on monetary policy, signaling whether the labor market has recovered enough to warrant a less accommodative tilt. Namely, many Fed officials have been waiting to see the evolution of the labor market recovery to determine the timing for the central bank to announce tapering of its $120 billion per month asset purchase program.

Last week, Federal Reserve Chair Jerome Powell said during the central bank's virtual Jackson Hole symposium that there has "been clear progress toward maximum employment" and suggested "it could be appropriate to start reducing the pace of asset purchases this year" if the recovery continues to improve.

However, he also flagged the ongoing risks introduced by the Delta variant, and added that an "ill-time policy move" could knock the recovery off its trajectory.

"Given the emphasis that Powell and other FOMC members have placed on incoming data — especially on the labor market — the payrolls report will probably take on even greater importance than usual," Jonas Goltermann, senior markets economist for Capital Economics, wrote in a note on Friday. "We expect another robust increase in U.S. employment,"

Other data in Friday's jobs report will include average hourly wage changes. These are expected to grow 0.3% over last month and 4.0% over last year, with these paces remaining roughly unchanged compared to July. The increases are set to come as job growth slows across lower-wage roles after an initial reopening surge in hiring in the spring and early summer, and as worker shortages push up compensation costs across many firms.

Consumer confidence
Other economic data due for release this week will reflect consumers' assessments of the recovery.

The Conference Board's consumer confidence index is set for release on Tuesday, with a drop baked into the forecast. Consensus economists expect the index to slip to 123.0 for August, down from 129.1 in July, according to Bloomberg data. July's print had been the highest since February 2020, marking a rebound in confidence back to pre-pandemic levels.

The Conference Board's labor differential, or difference between those who said jobs are "plentiful" less those who said jobs were "hard to get," also increased to the most since 2000 in last month's report, pointing to the abundance of job openings as employers seek out workers to meet rising demand.

Consumer confidence and sentiment indices have been monitored closely this year as a gauge of the outlook among Americans at large, pointing to consumers' propensity to spend and presaging demand trends for goods, services and labor down the line. The data have been bumpy in recent months, however, and have ebbed and flowed largely in line with COVID-19 infection trends.

The latest surge in the Delta variant catalyzed a collapse in the University of Michigan's Surveys of Consumers index for August, suggesting the Conference Board's measure might also see a similar dip for the month. The University of Michigan's consumer sentiment index slid to a 10-year low in August, plunging to 70.3 from July's 81.2.

"Consumers' extreme reactions were due to the surging Delta variant, higher inflation, slower wage growth, and smaller declines in unemployment," Richard Curtin, Surveys of Consumers chief economist, wrote in a press statement. "The extraordinary falloff in sentiment also reflects an emotional response, from dashed hopes that the pandemic would soon end and lives could return to normal.""

"Economic calendar

• Monday: Pending home sales, month-over-month, July (0.4% expected, -1.9% in June); Dallas Fed Manufacturing Activity index, August (23.0 expected, 27.3 in July)
  
  
• Tuesday: FHFA Home Price index, month-over-month, June (1.9% expected, 1.7% in May); S&P CoreLogic Case-Shiller 20-City index, month-over-month, June (1.87% expected, 1.81% in May); S&P CoreLogic Case-Shiller 20-City index, year-over-year, June (18.60% expected, 16.99% in May); MNI Chicago PMI, August (68.0 expected, 73.4 in July); Conference Board Consumer Confidence, August (123.4 expected, 129.1 in July)
  
  
• Wednesday: MBA Mortgage Applications, week ended August 27 (1.6% during prior week); ADP employment change, August (650,000 expected, 330,000 in July); Markit U.S. Manufacturing PMI, August final (61.2 expected, 61.2 in prior print); Construction spending, month-over-month (0.2% expected, 0.1% in June); ISM Manufacturing index, August (58.5 expected, 59.5 in July)
  
  
• Thursday: Challenger Job Cuts, year-over-year, August (-92.8% in July); Initial jobless claims, week ended August 28 (346,000 expected, 353,000 during prior week); Continuing claims, week ended August 21 (2.862 million during prior week); Unit labor costs, 2Q final (1.0% expected, 1.0% in prior print); Trade balance, July (-$74.1 billion expected, -$75.7 billion in June); Factory orders, July (0.3% expected, 1.5% in June); Durable goods orders, July final (-0.1% in prior print); Non-defense capital goods orders, excluding aircraft, July final (0.0% in prior print); Non-defense capital goods shipments, July final (1.0% in prior print)
  
  
• Friday: Change in non-farm payrolls, August (750,000 expected, 943,000 in July); Change in manufacturing payrolls, August (700,000 expected, 703,000 in July); Unemployment rate, August (5.2% expected, 5.4% in July); Average hourly earnings, month-over-month, August (0.3% expected, 0.4% in July); Average hourly earnings, year-over-year, August (3.9% expected, 4.0% in July); Markit U.S. services PMI, August final (55.2 expected, 55.2 in prior print); Markit U.S. composite PMI, August final (55.4 in prior print); ISM Services Index, August (62.0 expected, 64.1 in July)"
  

"Earnings calendar

• Monday: Zoom Video Communications (ZM) after market close
  
  
• Tuesday: Crowdstrike (CRWD) after market close
  
  
• Wednesday: Campbell Soup (CPB) before market open; Okta (OKTA), Chewy (CHWY), C3.ai (AI), Asana (ASAN) after market close
  
  
• Thursday: American Eagle Outfitters (AEO) before market open; Broadcom (AVGO), DocuSign (DOCU), MongoDB (MDB) after market close
  
  
• Friday: No notable reports scheduled for release"

MY COMMENT

YEP....a normal week ahead. Earnings are coming to a close at historic levels. The re-opening continues and the economic data is going to continue to be ERRATIC. To me.....looks like a good week for 1-2% gains in the various averages and good potential for all time highs for investors.

 

It is the weekend so I will stray from stock investing and into the area of investing in......YOUR OWN growth and life. I helped a friend recently find a "first job" for his daughter. Understandably for young people....finding that first job seems like a CRISIS. It is good to keep in perspective that you will have 35-50 years ahead of you in the work world....so....it is not going to matter one bit if it takes you a few months to find a job.

When my kids were just starting out in first jobs I gave each of them a subscription to this little publication for their first few work years.

Ragan Communications acquires The Economics Press's flagship title, Bits & Pieces.

https://www.thefreelibrary.com/Raga...onomics+Press's+flagship+title,...-a075286983

"Bits & Pieces, the unique, pocket-size motivational publication with a loyal readership of more than 250,000 people worldwide, has been purchased by Lawrence Ragan Communications Inc. from The Economics Press. First published 33 years ago by John Beckley, founder of The Economics Press, Bits & Pieces became the leading source of inspirational stories, anecdotes and quotes for businesses of all sizes, including many Fortune 500 companies.

"It's very difficult to find a sales person or trainer who is not familiar with this publication," said Dan Oswald, president of Ragan Communications. "Its reach is monumental."

Subtitled "The Magazine that Motivates the World," the 24-page, 4 x 61/2" publication is read by salespeople, middle managers, CEOs, parish priests, small-business owners, truck drivers, gas station attendants--"anyone who loves being inspired by a spine-tingling quote or upbeat story," Oswald said.

The sale also includes Leadership ... with a human touch, another pocket-size booklet with "practical wisdom from leaders down through the centuries."

Other assets in the purchase include compilations of Bits & Pieces and other ancillaries.

"It is not without some degree of sadness that we mark the departure of Bits & Pieces from our stable of motivational and employee training publications," noted Alan D. Yohalem, president and CEO of The Economics Press.

"It has been our flagship title since its inception. We are happy, however, that it will now be in the very capable hands of the people at Ragan Communications. I believe that under Ragan's direction, its best days are still ahead."

Yohalem said the sale will allow his company "to focus its efforts and resources in a new strategic direction."

Ragan Communications, founded in 1969 by the noted business communications expert Lawrence Ragan, publishes seven management newsletters that share some of the characteristics of Bits & Pieces.

Mike King, publisher of Ragan's management newsletter group, pointed out two of the company's newsletters that especially fit well with Bits & Pieces: The Motivational Manager and Positive Leadership.

"This was a strategic purchase for us," King said. "The people who read Bits & Pieces match the demographics and profile of our readership. The potential synergies are endless."

A recent contest asking readers to tell how the publication changed their lives yielded over 2,000 entries, Oswald said.

"There is a passion for this tiny little magazine that is awe-inspiring," King said. "Who wouldn't want readers who are that engaged?"

In addition to its management newsletters, Ragan publishes 14 other newsletters in the fields of employee communications (including its 1970-founded flagship newsletter, The Ragan Report), media relations, public relations, and the internet. The company also sponsors a wide range of conferences in the same markets."

MY COMMENT

These little magazines are full of motivational materials and messages........and the power of positive thinking and visualization....... and are a GOLD MINE of material for those in jobs that involve sales, marketing, or other customer contact. They also contain many messages that are relevant to managing people. They seem very simplistic....but anything of value that contains a POSITIVE message....usually does.


HERE is a little article for those readers on here that are new or young employees.

What I Wish I Understood When Starting Out In My Career
From learning to “time travel” to good habits, here are 10 pieces of advice for young workers.

https://www.bloomberg.com/opinion/a...n-starting-my-career?srnd=personal-finance-v2

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

"The best part of my job as host of the Masters in Business podcast is that I get to sit down with an incredibly talented and accomplished person each week to discuss their life and career. I save my favorite question for last: “What do you know today about your chosen field that you wish you knew when you were first starting out years ago?” Answers like “I wish I bought Apple shares when they were at $2” are not what I’m seeking.

I am aiming for something along the lines of what hard-won insight they gained over the course of their careers that would have been useful had they learned it earlier. It is not a “time machine” question, but rather one of process. This is probably why it is also a hit among listeners. I previously addressed why I ask the questions I do, but this one deserves a deeper look. So, I spent some time thinking about it and the result is 10 things I wish I understood when I first started out:

1. Build your skillstack: Just because you finished your formal education does not mean you are finished learning. Education truly begins when you start working in the real world. Continuing to learn new concepts and ideas that can help you succeed in professional situations is too important to be left to chance. This can be done by taking classes, reading non-fiction and learning. 1
2. Addition by subtraction: Early on, I tried to learn by consuming everything I could. I eventually realized that not all content sources were equal. Basic information hygiene led me to remove the bad stuff, but it wasn’t until later in my career that I figured out that even the good stuff wasn’t good enough. To succeed, I needed to focus on excellence. That means eliminating all but the very best from my reading list, what assignments or jobs I took on, and even the clients I worked with. This may be counter-intuitive – we “systematically default to searching for additive transformations, and consequently overlook subtractive transformations” – but it’s a valuable skill.
3. Assemble a portfolio of people: There are a small group of talented people that I would pretty much do anything with or for: Hire them, work for them, invest in their start-ups, introduce them to my key contacts, etc. Just having them in your orbit makes your life better. This goes beyond simple networking. There are folks from early in my career I wish I had spent more time and effort nurturing relationships with.
4. Trusted counsel: Having a person whose judgment you trust and who can provide unfiltered feedback is incredibly valuable. This is very different than an informal survey of friends and work pals. A solid counselor is worth his or her weight in gold. This was a big and obvious miss for me early in my career. Insistence on equity and/or control was the sort of advice that was a godsend later in my career, but would have been incredibly useful earlier.
5. Failure is growth: Most of us fear failure, when we should embrace it. Without failure, there is no growth. If you are not failing, then you are not trying anything new or risky or out of your comfort zone. I became interested in the work of Ray Dalio, the founder of hedge fund Bridgewater Associates, because of how crucial the role of failure was to his career trajectory and success.
6. What are the metrics of success? Every profession has a series of datapoints that are used to judge its practitioners: sales quotas, surgical outcomes, etc. You may not be explicitly told this is how you are being evaluated, but you are, and it’s critical to understand these metrics.
7. Learn to time travel: It took me a while to learn how to “travel” a few decades into the future and then return to the present. Being able to conceptualize what the future looks like is one thing, but the real trick is recognizing that dynamism underlies everything. Nothing is static, and all things constantly change, adapt and move forward.
8. Don’t worry about your first few jobs: So many Masters in Business guests gave this as their answer that it forced me to rethink the first decade of my career. If I had this advice, I may have been more productive, focused less on stuff that turned out to be meaningless and could have progressed faster.
9. Collaboration: I spent the first half of my career working mostly by myself. I wish I had better understood what comes from working closely with others and being able to divide duties according to skillset. This allows you to focus on what you do best. The results of an ensemble show up in better productivity and higher quality work.
10. Good habits: We are our habits. Some of mine are pretty good, like getting up at 4:30am each day to pound out 500 to 1,000 words of content for my blog. After 20 years of this, it has turned me into a better writer. Turning tasks into a routine that eventually becomes a habit is something I wish I learned decades ago.

Each of these are things I wish I knew decades ago. “Better late than never” applies to me, but those of you who are starting your career might find something worthwhile in this list."

MY COMMENT

I would add to the above.....learn to manage people. Get a MENTOR and meet with them regularly. AND....one that I believe is very important in the world today, especially as you move into the higher business world......get some classy thank you note stationary with envelopes and a good fountain pen....and use them for personalized hand written Thank You notes when appropriate.

 

I am going to call these devebacker posts......BAKERISMS.

 

TireSmoke. You probably know that there are a number of "car toy" and other collectors on this board. You and oldmanram....cars.....Zukodany....comics......myself American Impressionistic Art......Emmett.....clown paintings......and many others. I cant remember who it was, but I know we have some baseball card collectors on here also.

All of these items and many more types of collectables do represent diversification for part of a persons net worth. I usually seem to hold about 20% of my total net worth in Art and Antiques. I consider net worth to be composed of FIVE categories:

Stocks and Funds
Art and Antiques and personal property
Real Property (my house)
Cash and cash equivalent
Guaranteed income sources (Social Security and Income Annuities)

For anyone that is a serious and educated collector of...."something"....that has actual market value.......you can get the enjoyment of a nice hobby PLUS own items that have value on the market......and if you are lucky....will increase in value over your lifetime.

 

Well....the markets are open for another week. Week by week....month by month.....and EVENTUALLY you are talking about the long term. This thread will hit its THREE YEAR anniversary in early October. That length of time is approaching.....LONG TERM. At that point this thread will be covering a......minimal..... LONG TERM time period.

The REAL value of this thread at that 3 year point will be for someone to go back and see how things worked out over the short term day to day commentary on here.....VERSUS.......the longer term THREE YEARS. The short term is represented by constant excitement, turmoil and drama.....but....over the WHOLE 3 years......as a long term investing holding period.....the returns have been great.....and.....if you had no idea of all the day to day "stuff".....you would think it was easy.

The HUGE gains reflected in this thread in the posts of many investors are for the most part due to.....SIMPLY.....holding over the 3 year time span. NO market timing, no trading.......just simple long term investing through it all. I would consider THREE YEARS as the bare minimum when it cones to a definition of the LONG TERM. I prefer to think of long term investing as....at the minimum......5-10 years.

SLOW AND STEADY WINS THE RACE.

 

NOW...talking about short term drama......the FED. It has just been INSANE how much the FED has come to DOMINATE the day to day thinking of investors. To begin with.....like all similar groups they tend to be INCOMPETENT. They REALLY have no ability to predict or control the economy. It is all hindsight analysis....they are just as wrong and insignificant as all the ECONOMISTS and ANALYSTS that try to predict the short term financial events and are ALWAYS UNIFORMLY WRONG.....when the real data is released.

The Overlooked Lessons at Jackson Hole
What investors should and shouldn’t take away from Fed Chair Jerome Powell’s speech.

https://www.fisherinvestments.com/en-us/marketminder/the-overlooked-lessons-at-jackson-hole

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

"Fed Chair Jerome Powell virtually delivered his much-anticipated speech at the Kansas City Fed’s annual Jackson Hole central banker-fest Friday. As expected, he pretty overtly hinted the Fed is heading towards slowing quantitative easing (QE) bond purchases—i.e., “tapering”—this year. Loads of pundits see QE as crucial to stocks and the economy, and many have hyped this proclamation as a watershed moment. But, no shock to us, the news didn’t seem to faze markets one bit. In our view, this is further evidence pundits’ Fed focus is overdone. Central banks simply aren’t as powerful as many believe—worth remembering amid calls to give them even more responsibilities.

In past communications, the Fed has tied changes to monetary policy to the state of the economic recovery. Powell often referred to the need for “substantial further progress” before even considering any adjustments. His speech today implies that hazy distinction has been hit, with most coverage focusing on this particular section:

My view is that the ‘substantial further progress’ test has been met for inflation. There has also been clear progress toward maximum employment. At the FOMC's recent July meeting, I was of the view, as were most participants, that if the economy evolved broadly as anticipated, it could be appropriate to start reducing the pace of asset purchases this year.

In Fedspeak—the purposefully vague and nebulous communication used by central bankers—this is about as clear a taper signal as you will get. The market reaction, though, amounted to a yawn. 10-year Treasury yields ticked down to 1.31% from 1.34% while US stocks rose 0.9% on the day, closing at a fresh record high.[ii]

Most fixation on Powell’s Jackson Hole speech stems from the bizarre notion stocks’ rise since last March was due largely to Fed action—particularly QE. In our view, this is vastly overstated. Some of the Fed’s actions may have helped calm investors last March, but other “emergency” moves may have stoked panic, too. As for QE, it just isn’t the economic boost many presume. As we have argued often, QE is an economic sedative, not stimulant. Banks borrow short term to lend long. The Fed’s buying long-term debt lowers long-term interest rates, and with short-term rates already near zero, the result is a smaller gap. That makes lending less profitable, discouraging banks from taking on the risk of making loans.

In our view, markets’ non-reaction really shouldn’t shock. Even if you disagree with our QE views, pundits parse every Fed official’s words routinely. We believe efficient markets have heard taper chatter since the year’s start—noise that has only increased lately. Those taper discussions sapped surprise power by the time Powell delivered his address today—forward-looking markets already reflect the information.

In our view, the obsession with central banks has lately spun even more out of control—in ways that risk politicizing monetary policy. For example, some pundits think central bankers should account for climate change in crafting monetary policy. Fed Governor Lael Brainard addressed the topic in a March speech, positing climate change could increase financial system vulnerabilities—necessitating Fed investment in research and tools to address the potential risks. After its recent strategy review, the European Central Bank (ECB) paid lip service to fighting climate change.

But expanding the Fed’s responsibilities has more downside than upside, in our view. The Fed exists to serve as lender of last resort to banks in a crisis. Congress added a “dual mandate”—to foster maximum employment and stable inflation—in the 1970s, after former President Richard Nixon strong-armed former Fed head Arthur Burns into holding interest rates artificially low early in the decade, contributing to high inflation. But the Fed’s record on these measures isn’t stellar. It failed to act as lender of last resort amid runs in 2008. After announcing an inflation target of 2% y/y in 2012, the Fed spent the next 8 years undershooting it. (They updated their strategy last August.) Moreover, the Fed lacks a crystal ball. As transcripts from 2008 meetings show, most Fed officials completely whiffed on diagnosing the financial crisis. Just two weeks after Fed decisions forced Lehman Brothers to fail, former Fed chair Janet Yellen—then San Francisco Fed President—joked about the recession’s chief effects being dwindling country club memberships and deferred plastic surgeries. Fed governors closed that gathering debating whether their policy statement should characterize them as watching economic developments “closely” versus “carefully.” They seemed broadly unaware the worst financial panic since the 1930s was underway.

Given their ineffectiveness with hitting inflation targets and economic outlooks, why add another target—especially one far removed from the Fed’s purview? Knowledge of climate science, itself an evolving field, isn’t in a central banker’s wheelhouse, last we checked. Nor is knowledge of the various technological solutions to emissions and electricity generation. It also isn’t clear how Fed actions could impact the environment or climate. The Fed’s tools are designed to address monetary conditions that have a downstream impact on macroeconomic conditions. It lacks tools to address things at a sectoral or industry level directly, even if it wanted to.

Some suggest the Fed and other central banks should add environmental criteria for potential QE asset purchases or future policy actions—meaning it wouldn’t buy bonds from firms like fossil fuel producers. Lots of folks suggest this would make their funding more costly—and curtail their ability to expand production, etc.—unless they went greener. But this implies central banks are the market’s most important participant—a fallacy, in our view. Even if central banks decide to favor a certain industry or sector, the “losers” won’t necessarily be cut off from markets. As yields rise, private investors may see a buying opportunity and step in, offsetting that pressure.

But regardless of the practical impact (or lack thereof), this would look like unelected officials picking winners and losers. That is politicians’ stock and trade. The more the Fed does this, the more it invites political interference in monetary policy. That is dangerous. Revisit the Nixon-era lessons. The Fed has never been totally independent, but it generally has enough freedom to implement policy without worrying about what it does to politician XYZ’s election chances. The more it injects political choices into policy, the less likely that holds in the future.

There is no clear sign the Fed will add politicized factors to its purview. But we generally subscribe to Occam’s razor—simpler is often better. We fail to see how adding more complexity to the Fed’s job would lead to better monetary policy."

MY COMMENT

Of course......the FED will continue to MOVE the markets...mainly because the professional short term traders and the BANKS they work for......like the system to operate that way. For the little investor......the silent majority....the FED has no real relevance at all....other than destabilizing the markets week to week with their constant CHATTER and PRONOUNCEMENTS. After all.....we are talking about a bunch of ECONOMISTS......NOTHING they do is science...it is simply hindsight armchair financial psychobabble.

 

LIFE IS GOOD......the primary averages are ALL positive at the moment. Icing on the cake.....the ten year yield is currently at 1.294%......lingering at the LOW END of the past ..........100 years of yields. There is NOTHING that is going to happen this week......other than a black swan......that is a BARRIER to the markets continuing to RISE. We start the final four months of the year with nearly EVERYTHING lined up for a BOOMING end to what has ALREADY been a great year for stock and fund investors.