The Long Term Investor

That is what I like about this board and this thread. No matter what style of investor or trader you are......if you are on here....you are NOT the norm. YOU.....are exceptional.

 

Good for TireSmoke. The CHIP companies seem to be having a very good time right now. Intel reported great earnings.....for them.....a day or two ago.

I am glad to see this critical business niche doing well lately. I dont think INTEL is out of the woods yet.....but the current earnings are a welcome change from the disastrous time they have been having for the past 5-10 years.

(NO....I have NO interest in Intel as an investment)

 

LOL.....I got outbid on the painting that I was trying to buy for my sibling yesterday. Only two people were bidding.....one of them me. It sold for a relatively cheap price....but that price was over what I was willing to pay.

 

We are into the real GUTS or earnings now. Over 300 companies will report today. I just went through the entire list. The most important are probably Proctor & Gamble and Colgate....both of which reported before the bell. Classic BIG TIME consumer conglomerate companies.

Procter & Gamble sales rise slightly, fueled by higher prices

https://www.cnbc.com/2023/07/28/procter-gamble-pg-q4-2023.html

Colgate-Palmolive bumps up annual sales, profit forecasts on strong pricing

https://finance.yahoo.com/news/colgate-palmolive-bumps-annual-sales-121421745.html

PG is up after earnings and CL is down.

I owned these two companies for a long time in the 1980's and 1990's and into the 2000's. They were key components of my long term, consumer conglomerate oriented, BIG CAP portfolio.

If I was looking for a safe, long term, conservative, dividend paying, BIG CAP stock I would consider PG as an option. Over 5 years the stock is.....+91.05%.

I have not looked at them lately (past 10 years).....but now that I am down to only 9 stocks......if I am ever looking to add a NON-TECH holding to balance out my tech risk.....I will look at them as an option.

I do like to have NON-TECH stocks like COST, HD, NKE, and AMZN......to balance out my portfolio. I dont expect to add anything for the rest of this year or early next year. Yes they have the cloud....but.....I consider AMZN as a consumer conglomerate.....retail....stock.

 

SO FAR.....STILL GOOD. Of course I was saying the same thing yesterday. FINGERS CROSSED......now there is a real investing strategy.

 

Having just looked I have a GOOD GAIN going today in my stocks. Nine for nine are UP at this moment.

Lets turn today into a FRIDAY FRENZY for the markets. We need to RACK UP some money for the weekend.

We are on track for yet another big gain week for the SP500....my primary market indicator.

 

A KILLER day for the markets and my account today. ALL green except for HON. I will take it all day long.....a nice solid gain in account value. I also got in a good beat on the SP500 by 0.60%.

What a nice gift to investors to end the week.

 

With earnings BOOMING and the FED over with till September and probably beyond......and.....considering the very good economy....it is hard to imagine anything that can really stand in the way of the markets from now to the end of the year.

I should not say that....because there is always something LURKING that is unexpected.

Even if you are not in much tech.....it is hard to imagine many investors that will not make up all their losses from 2022....by the end of this year. The ONLY requirement.....you have to be in the market to get the gains.

 

READ'em and weep......negative ninny's. Another BANNER week..Is there anyone that is doubting this BULL MARKET now? Sure we could still have a correction at some point.....but it is now clear that last year is in the rear view mirror.

DOW year to date +9.98%
DOW for the week +0.66%

SP500 year to date +19.34%
SP500 for the week +1.01%

NASDAQ 100 year to date +44.01%
NASDAQ 100 for the week +2.09%

NASDAQ year to date +36.79$
NASDAQ for the week +2.02%

RUSSELL year to date +12.51%
RUSSELL for the week +1.09%

UNFORTUNATELY for the DOW.....all the positive days in a row and all the positive media coverage does NOT change the FACT that it is ONLY up by 6.98% for the year so far. It is SEVERELY lagging all the other averages. It is just not a very representative average in the modern era.

 

NOW.....my current year to date for my entire account.....+38.55%. I did not look at my account last week and did not calculate a YTD on last Friday. On July 14, 2023 the prior Friday I was at a year to date of.....+36.48%. So since than I have added another.....+2.07%%.

Here we are nearing the end of July.....with FIVE months to go in the year......and I am beating the SP500 by....+19.21%. Not the best on the board (ZUKODANY).....but I will take it.

I continue to PUSH toward my all time high......now about +4.6% away.

 

The close today.

S&P 500 closes nearly 1% higher on softening inflation data, nabs 3rd week of gains

https://www.cnbc.com/2023/07/27/stock-market-today-live-updates.html

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

"Stocks rose Friday with the Dow Jones Industrial Average and S&P 500 closing out their third winning weeks in a row as a measure of inflation closely watched by the Federal Reserve came in at its lowest in nearly two years.

The Dow jumped 176.57 points, or 0.50%, to 35,459.29. The S&P 500 added 0.99% to 4,582.23. The Nasdaq Composite
gained 1.90% to 14,316.66.

All three major averages notched weekly gains with the 30-stock average up by about 0.66%. On Thursday, the Dow ended a 13-day win streak, a length not seen since 1987. The S&P advanced 1.01%, and the tech-heavy index is up 2.02%.

This week, investors cheered data showing cooling inflation and stronger-than-expected earnings reports that supported the case the U.S. could avoid a recession.

On Friday, June data for the personal consumption expenditures price index continued to show easing inflation. The gauge showed core PCE gained 0.2% month-over-month, in line with the 0.2% increase expected by economists polled by Dow Jones. Core PCE rose 4.1% from the year-ago period, lower than the anticipated 4.2%.

The data is of particular interest after the central bank raised interest rates earlier this week in a widely expected move. The Fed targets inflation at 2% annually.

“In the wake of stronger than expected GDP, and a better-than-expected earnings season, this could be the catalyst to send the market to new highs,” wrote Gina Bolvin, president of Bolvin Wealth Management Group.

Earnings season continued with Dow member Procter & Gamble shares gaining nearly 3%. The consumer goods company behind Tide and other brands beat analysts’ earnings and revenue expectations in its most recent quarter.

Intel jumped 6.6% as investors applauded a return to profitability, while Roku
climbed 31% a day after beating Wall Street expectations on both the top and bottom lines.

On the other hand, Ford Motor shares fell 3.4% even though the automaker beat estimates and raised guidance. The company said its electric vehicle adoption was taking longer than expected due to higher costs."

MY COMMENT

Good job.....PG. Nice to see an old school company still kicking ass.

I dont see much that is going to change for next week.....although....we have BIG TECH earnings AAPL and AMZN on Thursday. That will be the anticipated DRAMA of the week.

 

I have wondered about this.

Google, Microsoft, and Meta can’t stop talking about A.I. — here’s why Apple rarely mentions it

https://www.cnbc.com/2023/07/28/why...-ai-as-much-as-google-meta-and-microsoft.html

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

"Key Points

• The most powerful technology companies simply cannot stop talking about artificial intelligence, and in particular, the “generative AI” flavor that can create human-like text, images, and code.
• Apple barely talks about artificial intelligence, and you shouldn’t expect to hear much about it during the company’s earnings next week.
• Apple’s AI works in the background. And the company doesn’t yell about it the way some of the other companies do because it doesn’t need to.

The most powerful technology companies simply cannot stop talking about artificial intelligence, and in particular, the “generative AI” flavor that can create human-like text, images and code.

During calls after this week’s earnings reports, Alphabet CEO Sundar Pichai and his team said “AI” 66 times. Microsoft CEO Satya Nadella and his execs said it 47 times. And on Wednesday, Meta CEO Mark Zuckerberg and the Facebook executive team said the magic phrase 42 times, according to a CNBC analysis of transcripts.

But Apple barely talks about artificial intelligence, and you shouldn’t expect to hear much about it during the company’s earnings next week.

Its sober approach to the new technology contrasts sharply with its rivals, which are stoking excitement and elevating expectations every chance they get.

During May’s Apple earnings call, CEO Tim Cook only said AI twice, and that was in response to a question. During Apple’s two-hour software launch event in June, it never said the phrase, although it announced several new features powered with AI.

Apple execs instead use the phrase “machine learning,” which is more popular with academics and practitioners. Apple execs also prefer to talk about what software does for the user, such as organizing their photos, improving their typing, or filling out fields in a PDF, as opposed to the technology that makes all that possible.

Apple’s approach to AI as a core underlying component instead of the future of computing represents a way to present the technology to its consumers. Apple’s AI works in the background. And the company doesn’t yell about it the way some of the other companies do because it doesn’t need to.

A closer look at executive remarks this week from earnings calls shows that while Meta, Microsoft, and Google are eager to sell the shovels for the AI gold rush, such as cloud services and developer tools, it’s still unclear how AI could change their most important products and when it could start bolstering balance sheets.

Google, for example, has announced its plans to revamp its search engine using an AI model called Search Generative Experience. Microsoft’s biggest new initiative is a $30 per month “Copilot” subscription that integrates generated text or code from partner OpenAI’s ChatGPT into Word, Powerpoint and other apps. Facebook parent Meta’s most recent investment in AI technology is its own large language model it calls LLaMA, which could underpin new kinds of social media chatbots or automatically generate online ads.

Meanwhile, Apple still makes the bulk of its money from iPhones, which generated $51.3 billion of its $94.84 billion in revenue during the company’s fiscal second quarter. Why talk a big AI game?

Besides, mega-cap tech companies signaled to investors earlier this week in earnings calls that the rollout of AI products could take a while.

In Microsoft’s case, Nadella tempered investor expectations for Copilot, signaling that growth would take time, and finance chief Amy Hood said that its rollout would be “gradual.”

It could take until next year before investors understand how the Copilot subscription affects the company’s revenue. “In the second half of the next fiscal year, we’ll start getting some of the real revenue signal from it,” Nadella said.

Google and Pichai say that the company’s text-generating AI models will make its search engine better and could even answer questions that normal Google search can’t. From a business perspective, Pichai said, generative AI used for creating and serving ads will “supercharge” the company’s existing ads business, adding there are “opportunities” for new kinds of ads with AI-generated search.

But Pichai said it’s still “early days” for the new AI-powered search, and later, when pressed about how SGE might increase usage of the search engine, and therefore increase revenue, he said the company was experimenting.

“I think we are definitely headed in the right direction, and we can see it in our metrics and the feedback we’re getting from our users as well,” Pichai said.

Zuckerberg was effusive about AI technology and its applications in virtual reality, ad targeting and recommending content from accounts users don’t follow.

He was particularly optimistic about a concept called “AI agents,” in which software would be able to message business customers automatically without a human involved, or act as a coach, or be a personal assistant.

Still, Zuckerberg admitted he didn’t know how many people would use the new AI features.

“The reality is, we just don’t know how quickly these will scale,” Zuckerberg said. He said Meta was debating internally how much it should spend on servers for AI.

The slow rollout of revenue-generating AI products from Big Tech matters because many people in the industry believe that new foundational technologies go through a “hype cycle” based on research from analysis firm Gartner.

When new technology is introduced, according to the hype cycle model, it gains lots of attention and investment as it reaches a “peak of inflated expectations.” But, as the deployment of the tech moves slower than initially expected, enthusiasm and investment dry up, in a “trough of disillusionment,” before maturing and becoming productive.

For now, “shovel makers” and people seeking investment capital are benefiting from the AI boom. Nvidia stock has risen 220% so far in 2023 as investors have realized its graphics processing units are essential for the technology. Venture capital investment in AI startups has boomed, and many of those dollars are going to Nvidia for computer capacity, and to cloud providers for access to AI models.

But if everyday consumer applications for AI don’t catch on, then many AI companies could slip into the trough of disillusionment again. Analysts found earlier this month, for example, that downloads for OpenAI’s iPhone app slowed earlier this month after launching in May.

Some analysts are starting to understand that an investment opportunity based on new AI products won’t be immediate and that the costs could stack up.

“We cautioned investors that that process of translating early demand to large-scale implementations and recognized revenue will be a multi-year trend rather than an instantaneous flip of a switch,” JPMorgan analyst Mark Murphy wrote this week.

“We recommend investors invest elsewhere until Metaverse, Reels, Threads, Quest and Generative AI investments become accretive (if ever) to META’s [return on invested capital], rather than dilutive,” Needham’s Laura Martin wrote in a note.

UBS analyst Lloyd Walmsley wrote this week that generative AI was still an “overhang” over Google.

“Management expressed optimism around the ability to solve for ‘deeper and broader’ use cases with Search Generative Experience (SGE), but we do not believe the company is out of the woods with management still describing monetization as having a ‘number of experiments in flight including (for) ads,’” Walmsley wrote.

When Apple reports its earnings next week, analysts will likely press it on its plans for AI, given the industrywide obsession, and especially after a recent Bloomberg report that said the company was developing a ChatGPT-like language model internally.

Last month, Apple announced new iPhone keyboard software that uses the same transformers architecture as GPT, showing that it has substantial internal development of AI models. But the tech giant just doesn’t like to talk about products that aren’t out on the market yet to stoke investor anticipation.

Apple is unlikely to discuss AI at length next week as its mega-cap rivals did this week. During Apple’s earnings call in May, when asked about the technology, Cook quickly moved the conversation back to the company’s products and features.

“We view AI as huge and we’ll continue weaving it in our products on a very thoughtful basis,” Cook said."

MY COMMENT

No doubt....APPLE in their approach.....is causing shareholders to miss out on some short term gains. BUT.....in the end......we will see who is just full of BS and who is actually walking the walk...even if they are not constantly blabbing about it.

Currently Meta/ZUK is full on mentioning AI at every opportunity. We will....eventually..... see if there is more here than HOT AIR. We now know about how the BS worked out on the Metaverse. I am suspicious of any company CEO that starts and ends every sentence with......"AI". "AI.....I am heading to the bathroom....AI"

Companies need to be realistic and not let expectations run too far ahead of reality. Those companies may set up shareholders for a very NASTY surprise later.

 

HAVE A GREAT WEEKEND EVERYONE......WE EARNED IT.

 

A good Saturday article.....plus.....a warning, a wake-up call, and a call to action.

Ready or not: Generation X faces bleak retirement horizon

https://finance.yahoo.com/news/read...faces-bleak-retirement-horizon-130324103.html

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

"It's a somber retirement forecast for Generation X workers – those who are now between the ages of 41 and 56.

Many in the so-called latchkey-kid generation, who may have muddled through a childhood with less parent hand-holding than millennials and baby boomers, are now in need of some serious nurturing, according to a new report published by the National Institute on Retirement Security (NIRS).

The NIRS scrutinized the retirement readiness of Gen X, and it’s not pretty.

The typical Gen X household has only $40,000 in retirement savings — and those savings are concentrated among top earners — according to the findings published by the nonpartisan organization. Also, Blacks and Hispanics have considerably lower savings and access to employer-provided retirement plans as compared to whites.

Welcome to the ‘new retirement’

“Generation X represents the leading edge of the new retirement in America,” Tyler Bond, a co-author of the report and NIRS research director, told Yahoo Finance. “As the first generation to mostly enter the workforce after the move away from defined benefit pensions in the private sector, most Gen Xers will not enjoy the secure retirement income that pensions have provided to so many in previous generations."


National Institute on Retirement Security
The report, which defines Gen X as those born between 1965 and 1980, about 64 million Americans, or nearly 20% of the US population, is based on research data from the Survey of Income and Program Participation (SIPP), which provides information on income, employment, household composition, and government program participation.

The tenuous outlook for Gen X has been trumpeted in a range of recent reports this year, including the finding from the 23rd Annual Transamerica Retirement survey that about one in three Gen Xers do not have any financial strategy for retirement.

“The retirement landscape shifted dramatically for this generation, and they’re at risk of falling through the cracks,” Catherine Collinson, CEO of Transamerica Institute and Transamerica Center for Retirement, said.

Zero retirement savings

The troubling crux of the NIRS research: The median account balance for an individual in Gen X is only $10,000, which means half of Gen Xers have less than that amount saved for retirement. One in four Gen Xers don’t have a retirement savings account at all. For Black Gen Xers, the median retirement account balance is $1 and half have nothing at all. Two-thirds of Hispanic Gen Xers haven’t even started a retirement savings account.


National Institute on Retirement Security
There’s a notable gender gap, too. The median retirement savings is $13,000 for single Gen X men and $6,000 for Gen X women. (That might be because Gen X women are more likely to work part-time.) Married men and women tend to have higher savings levels.

Why is Gen X so behind?

One factor: 401(k)s were just coming online when Gen X entered the workforce — and relatively few workers had access to them. Only 14% of Gen Xers have a traditional employer pension plan, and only about half (55%) have access to an employer-provided retirement plan at their job like a 401(k).

That’s the overarching problem.

When workers don’t have access to an employer-sponsored plan, they typically don’t start their own retirement accounts. Only 5% of workers take the steps to open up a retirement savings account if it is not provided by their employer, according to Angela M. Antonelli, executive director of the Center for Retirement Initiatives at Georgetown University. If a worker has access to an employer-sponsored plan, participation jumps to 72%.

Having access to saving in a retirement plan at work is typically reserved for full-time employees. But 12% of working Gen Xers work part-time, the NIRS report found. Among Gen X men, 7% worked part-time. For Gen X women, it was more than double that number to nearly two in 10 (18%).

The fact it’s easier to save when you have an employer-provided retirement account. Workers with an IRA or Keogh account had an average balance of $148,920 and the median balance was $44,100. For those with 401(k), 403(b) and other employer-sponsored plan, the average balance was $173,553 and the median balance came in at $50,000. "These are better than the overall numbers, but are hardly encouraging for a generation fast approaching retirement age," Bond said.

It is no surprise that Gen X workers who are top earners are holding their own. The top quartile of Gen X workers with income of $76,789, and above, have savings of around $250,000, on average, while the bottom half — those with incomes of $43,921 or less — have almost nothing socked away.

When looking at the median, those Gen X households with $24,096 or less in income have only $200 saved for retirement. Those with income between $24,097 and $43,920: $4,290.

New policy initiatives may help

Is there hope?

If Gen Xers start saving now, they can make up for lost time. Most Gen Xers are in their peak earning years and the youngest Gen Xers have two decades to work with.

Some new public policy changes are likely to make it easier for many part-time workers. A new provision in the Secure 2.0 legislation, which will go into effect in 2025, requires that 401(k) or 403 (b) plans allow a long-term part-time employee to participate in the plan, if that employee worked at least 500 hours per year for two consecutive years.

Meantime, a growing number of states have passed laws in recent years to help clear up this retirement savings dilemma. And the new legislation seems to be propelling a boost in employers opting to offer a 401(k) plan instead of participating in their state’s program, according to the National Bureau of Economic Research (NBER).

So far, 19 states have enacted retirement programs for private-sector workers. Fifteen of these states are auto-IRA programs. They require most private employers that don’t sponsor a savings plan of their own to enroll workers in a state-facilitated individual retirement account at a preset savings rate — usually 3% to 5% of earnings — and automatically deducted from paychecks.

Given the number of Gen Xers who are not currently participating in a retirement plan, increasing access to savings plans is potentially a big boost. But it’s just a beginning.

And then there's the nagging shadow of Social Security. Many Gen Xers are not confident Social Security will be there for them when they need it, the NIRS researchers conclude. They either think that Social Security will go bankrupt before they are eligible to claim benefits, or that the benefits will be cut.

“There are looming retirement challenges facing Gen X,” Bond added, “and an urgency to strengthen the nation’s retirement structure for these workers and the generations that will follow.”"

MY COMMENT

FIRST......yes....Social Security will be there. It is NOT going bankrupt and it is not going to disappear. Now....if they could keep congress from RAIDING the trust fund every year.....it would be in fine shape, the money would be sitting there. The ONLY issue with Social Security is the FACT that the trust fund in reality DOES NOT EXIST. It is basically funded by current contributions and government on a pay as you go basis. BUT......the CRAVEN POLITICIANS will never stop or close down the program.

SECOND......and most important......starting with the Baby Boom generation.....we have been living in the era of NO PENSIONS. Most baby boomers do not have a pension. If they ever did....the government......allowed their employers to cash out their pension with a lump sum long ago.

As a result.....we are all in the same boat.....YOU HAVE TO TAKE CARE OF YOURSELF....if you are not a government worker. Of course.....we have allowed the government to continue to MANDATE, often big pensions, for themselves and their workers that no one else gets.

THIRD.....if you are in this HUGE group of people that do not work for government....no matter how close you are to retirement....YOU....... have to take the first step for your own future. IT IS NEVER TOO LATE if you are still working. ANYTHING is better than nothing. YOU......have to start to save and invest. DO IT NOW....START TODAY...YOU CAN DO MORE THAN YOU THINK AND CAN TAKE CARE OF YOURSELF If YOU ARE WILLING TO TRY.

ANYONE.....in this boat is welcome to post on here. Probably EVERY poster on here would be willing to give advise and encouragement. So if you are in this age group and need help....JOIN US.....TAKE CONTROL OF YOUR FUTURE.

 

That is a GREAT MONEY TRICK that anyone can use TireSmoke. Even in a down year....putting that money to work early....even if only a few months.....is GOLDEN over the long term.

YES.....in terms of all the larger averages 2022 has already been ERASED. Look at performance data for two years, three years, five years, ten years.....you would NEVER know what happened in 2022. For most investors I suspect that at the end of this year it will be as though 2022 NEVER happened.

Great idea and great post.

 

Here is the next five months....the future.

What historically happens after stocks soar through July: Morning Brief

https://finance.yahoo.com/news/what...oar-through-july-morning-brief-100029103.html

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

"Stocks tumbled Thursday, with the Dow Jones Industrial Average (^DJI) sinking the most in three weeks — dashing hopes of a nearly unprecedented streak of 14 straight winning days.

Notwithstanding the short-term weakness, July is nearly in the books and is set for a fifth straight month of gains in both the Nasdaq Composite (^IXIC) and the S&P 500 (^GSPC).

In addition to being up six out of the seven months this year, returns are unusually high — 34% for the Nasdaq and 18% for the S&P 500.

Filtering for these variables reveals an incredibly bullish tailwind for the US benchmark equities index.

Looking at the six prior times the S&P 500 was up five straight months in July, the return for the balance of the year was 8% on average with a 100% win rate.

Broadening out the analysis to include only those years when the January-through-July returns were 10% or more yields a more robust sample size of 21 instances going back to 1960.

These years return on average 4.8% from August to December with 95% of the results positive. (The only negative return was 1987, famous for its Black Monday crash in October.)


Stocks Up 10% or More Through July
Looking at big starts for the Nasdaq reveals a similar story, but a bit less bullish.

In 26 years going back to 1971, when returns were more than 10% by the end of July, the average return into year-end was 6.3% with positive results nearly 70% of the time.

Last Friday — way back when the Dow win streak was only 10 days — we looked at forward returns after such a feat. The results were positive two-thirds of the time with a few outliers that brought down the average.

Insert your boilerplate caveats here. There are no guarantees, only tendencies.

But the bottom line is no matter how you slice and dice it, market technicals are screaming to investors that they should respect the strength demonstrated so far this year.""

MY COMMENT

For those of us that are long term investors.....the next five months does not matter. We will continue to invest in the markets as usual and will continue to work that compounding. But....it you believe this sort of statistical data.....the probability....is that we will continue to gain over the rest of this year.

NO SURPRISE there since the long term data shows that the odds of any particular year being positive is bout 70%.

It should also be apparent to investors that the remainder of this year looks very nice......ALL or at least MOST of the headwinds of ther past 18 months are now over and done. The short term markets are NEVER clear sailing.....but.....the next five months look about as good as you can ever hope for.