The start to the year: DOW year to date (-0.04%) DOW five days (-0.04%) SP500 year to date (-1.52%) SP500 five days (-1.80%) NASDAQ 100 year to date (-3.09%) NASDAQ 100 five days (-3.09%) NASDAQ year to date (-3.25%) NASDAQ five days (-3.25%) RUSSELL year to date (-3.75%) RUSSELL five days (-5.21%) My start to the year......entire account year to date.....(-2.16%)
After 51 years being on this planet I learned something quite valuable that is often not shared in any investor’s blog or otherwise online Everyone’s different SHOCKING right? But we all want to win at the end of the day. I can’t imagine anyone, not even a masochist, wanting to lose. Where we are different is what we do with our wins. As to me, I just like the feeling of accomplishment. It really is all that it is. I will rarely go on a lavish vacation trip or ride a hot car. I own a 2002 accord, my wife got the Tesla. I wear jeans and a t shirt for work and rock a pair of Stan smith kicks. The most important thing to me in life is my health and securities. I honestly don’t say it to sound humble or pure. Oh no. I’m evil. I just don’t go out much I’ll have a nice steak dinner once in a while, but I always tell my wife, when we go out it’s all about the mood, the atmosphere and socializing. Food honestly comes second. There’s this thing now with everyone going for crème brûlée for desserts. Shove it up your hole.. I’m a chocolate brownie guy any day. My brother once bought a very expensive couch sectional. His wife told me I would never spend that kinda money on a couch. My wife corrected her and said that I would, the only catch is that I will have to be able to sell it for more if I ever considered buying it to begin with. I’m proud of her, she knows me well
I will certainty continue to hold these companies. Have confidence in the tech stocks https://www.washingtonexaminer.com/...strength-optimism/have-confidence-tech-stocks (BOLD is my opinion OR what I consider important content) "The Nasdaq Composite, with its large exposure to the biggest technology stocks, is starting the new year with a decided thud. After a stellar 2023, which saw the index rise by 43%, the Composite Index fell by 1.6% on Tuesday, the first day of trading in 2024. It continues to experience selling pressure. This begs the question: Should traders and investors continue to take profits because investor sentiment is frothy? Some market professionals are recommending that investors follow a strategy of sector rotation and sell the largest technology companies, which, in some cases, saw price appreciation of over 100%, and buy other sectors of the market that lagged the technology behemoths. Human nature says to "sell high and buy low," so there may appear to be some logic to the sector rotation strategy. But United States equities are marked by momentum trading. What goes up keeps going up, though there are periods when up markets take a breather. Still, when the uptrend is strong, most technical strategists recommend buying dips and riding the wave. Last year was great not only for the biggest technology companies but also for U.S. equities generally. The S&P 500 was up 24%. The last two months of the trading year were particularly strong. The S&P index was up 10% in November and December. When the S&P 500 is up 10% or more for the last two months of the year, it is always up in the first quarter of the new year, and the index continues to deliver stellar performance for the entire year. The outlook for U.S. equities is very positive . The Federal Reserve's 2% inflation target has been effectively achieved. The market overwhelmingly believes the Fed will cut interest rates this year. Economic fundamentals are solid. Real incomes are growing. The labor market is strong and resilient. Consumer confidence is rebounding. Gasoline prices are low and falling. A recession is well over the horizon. Logic says that the biggest technology names, Apple, Alphabet-Google, Meta, Microsoft, Amazon, and selected semiconductor giants, should continue to lead the market higher. The artificial intelligence revolution is real. Business and sovereign nations alike see AI as an investment imperative. U.S. companies such as Microsoft with ChatGPT are beginning to commercialize AI. Alphabet-Google is deploying its AI offering Gemini right now. The most advanced AI systems cannot be developed and commercialized without GPU semiconductors designed by Nvidia, and Nvidia GPU semiconductors cannot be fabricated without the Dutch company ASML's highest technology lithography technology. The valuations of the biggest technology companies are not excessive, given their fundamentals, earnings, free cash flow generation, operating margins, and competitive moats. The companies are growing two to four times faster than the typical constituents of the S&P 500. The companies generate significant amounts of free cash flow, and the companies invest much of that free cash flow in research and development to maintain their competitive advantage. Amazon came public in 1997. In the early 2000s, the stock traded as low as $6. Investors who did not sell are reaping gains of 166,000%. In turn, I believe it would be a mistake to trade out of big technology, the Nasdaq Composite, and the S&P 500. Upward momentum is your friend." MY COMMENT If you are an active trader......ok.....do what you want based on short term guesses. BUT....as a long term investor....I want to own the most successful businesses in the world. this little paragraph says it all in a nutshell: "The valuations of the biggest technology companies are not excessive, given their fundamentals, earnings, free cash flow generation, operating margins, and competitive moats. The companies are growing two to four times faster than the typical constituents of the S&P 500. The companies generate significant amounts of free cash flow, and the companies invest much of that free cash flow in research and development to maintain their competitive advantage."
If you are into CRYPTO or considering it....here you go. Cryptocurrency investors eagerly awaiting SEC ruling on bitcoin ETFs https://www.cnbc.com/2024/01/05/cry...eagerly-await-sec-ruling-on-bitcoin-etfs.html
If I was a young person.....I would consider this a HUGE opportunity. Is this stuff accurate.....I have no idea. But if this perception is true....even if not accurate....it is an issue for business and job seekers. Many college grads struggle to land jobs due to a lack of preparedness, study finds Is COVID partly to blame? Issues include eye contact and camera etiquette — and some even bring parents to interviews https://www.foxbusiness.com/lifesty...gling-land-jobs-lack-preparedness-study-finds (BOLD is my opinion OR what I consider important content) Recent college graduates are failing at job interviews, according to a new study. "Developmental setbacks from various factors have appeared to delay communication skills among Gen Z grads — and employers are taking notice. In a Dec. 2023 study, the New Jersey-based research group Intelligent surveyed 800 U.S. managers, directors and executives who are involved in hiring. The respondents reported that Gen Z candidates struggle to pick up professional cues, causing 39% of employers to favor hiring older candidates. About 60% of employers said they are willing to offer more benefits and pay higher salaries to attract older workers rather than recent grads. A number of recent college grads are reportedly failing at job interviews, according to a new study. (iStock / iStock) For that same reason, 48% of employers are offering remote or hybrid positions to older employees and 46% are willing to hire overqualified candidates, according to the new study. One in five employers reported that recent college grads are generally unprepared when it comes to interviewing for a job. More than half of employers surveyed said Gen Z candidates struggle the most with eye contact during interviews. Candidates in this age group also ask for unreasonable salaries and have dressed inappropriately for in-person interviews, according to about half of the study respondents. Sixty percent of employers reported that Gen Z employees are frequently late to work, the survey found. (iStock / iStock) Even virtual interviews have posed issues, with 21% of employers reporting that some candidates refuse to turn on their cameras for the interview. Nearly 20% of employers said they've even had a recent college grad bring a parent to an interview. Two in three employers reported that Gen Z employees are unable to manage their workloads, while about 60% said they are frequently late to work and often miss assignment deadlines. Sixty-three percent of employers consider Gen Z employees to be entitled, while 58% said they get offended too easily and are overall unprepared for the workforce. Employers also noted that their youngest employees lack professionalism, do not respond well to feedback and have poor communication skills. Almost half (47%) of employers in the survey said they've fired a recent college graduate. Potential reasons for grads' struggles In a separate August 2023 Intelligent survey, 62% of respondents said "culture" is the primary reason that many recent college grads are unprepared. Half the respondents blamed parenting, 48% said the COVID pandemic is the culprit, and 46% said educators are the root of the problem. Human resources expert Natalie E. Norfus, founder of The Norfus Firm in Miami, Florida, who was not involved in the new study, pointed fingers at parents, the pandemic and the shifting priorities of employers. "In this day and age, employers are far less willing to invest the effort and money it takes to train inexperienced workers because the demands on production are at an all-time high and average workplace tenures are lower," she said in an email sent to Fox News Digital. "We've heard several managers say they don't want to waste time training someone who's just going to leave." In defense of young workers Joe Mull, the Pennsylvania-based author of "Employalty: How to Ignite Commitment and Keep Top Talent in the New Age of Work," was not involved in the survey but shared his reaction to it, claiming the findings are "inherently skewed" because they are based on perspective. Joe Mull, a Pennsylvania-based HR expert and author, is a professional speaker for business leaders. He said there is "fierce" competition for talent, with jobs getting "snapped up more quickly." (Joe Mull / Fox News) "The idea that younger workers are less equipped, more entitled or less motivated is a generational trope as old as time itself," the career expert told Fox News Digital. "These unflattering perceptions of the workers coming in behind us are the same perceptions that older workers had about us when we arrived at the workplace." Mull also noted that there is "fierce" competition for talent, with jobs getting "snapped up more quickly." The indication that young workers are struggling to manage workloads and meet deadlines is "unfair," according to Mull, since burnout "continues to persist at record levels across the workforce." Burnout persists at "record levels across the workforce," a career expert told Fox News Digital. (iStock / iStock) "Organizations of every stripe are navigating staffing and retention challenges," Mull went on. "Workers of all ages are struggling with workloads and deadlines, often for reasons beyond their control, which have little to do with their character or work ethic." He supports the need for young workers to be mentored and trained by seasoned professionals, he said, instead of managers hiring older candidates with more experience to fill entry-level roles. Recent grad shares her story Recent college graduate Mikayla Kelly, 21, from New York, told Fox News Digital about her experience in applying for broadcasting jobs. Kelly graduated from Auburn University in December with a degree in journalism and a double minor in Spanish and marketing. She said she’s been applying for jobs but has received few replies from employers, since it’s a "competitive field." "Whenever I get off Zoom calls with news directors for stations I am applying to, I always feel self-conscious that they were not impressed by the way I spoke," she said. Mikayla Kelly (above) said she thinks higher education could have better prepared her generation for the "real world." (Arowynn Photography / Fox News) "I can tell I sound nervous and stumble over my words sometimes, and I think that’s because subconsciously, I never felt truly prepared to be thrown into a real-world interview." Rather than prioritizing scoring high on tests and completing general education courses that some students will "never be using," Kelly said she believes schools should focus on the basic communication and behavioral skills that students lost during the coronavirus pandemic. The pandemic hit during Kelly’s senior year of high school, which caused a majority of her classes to be remote during her first year of college. She said she’s noticed that the speaking and communication skills of some of her classmates have been jeopardized. "There is a difference between interviewing over Zoom versus in person, and I think we've been so accustomed to doing stuff over Zoom that it's so much different when you actually have to go in person," Kelly said. Mikayla Kelly, 21, graduated from Auburn University on Dec. 9, 2023. The pandemic hit during her senior year of high school, which caused a majority of her classes to be remote throughout her first year of college. (Mikayla Kelly / Fox News) "It's not just your speaking abilities — it's the way you dress, your mannerisms, eye contact … and I think we've kind of avoided that in the last few years." Kelly admitted that she doesn’t think college has adequately prepared Gen Z before they head into interviews and are "thrown into adulthood." More life skills-based courses and workshops on interviewing and career preparation could help fill these gaps, she suggested. Kelly said she personally feels this lack of preparedness for adult tasks, whether it's in interviewing or managing her finances. "It’s all pretty unfamiliar to me," she told Fox News Digital. "Just coming out of college and getting thrown into adulthood — it's kind of hard to jump right into a job." "Just coming out of college and getting thrown into adulthood — it's kind of hard to jump right into a job," a recent college graduate told Fox News Digital. (iStock / iStock) HR expert Norfus of Miami said the new study calls the value of a college education into question. "More and more, the value of college degrees is being deeply questioned. Do they really indicate the likelihood of success in the workplace, or the world?" she said to Fox News Digital. "Do colleges really prepare students for the real world? Is it worth making such a big investment to land in big-time debt when we see people making money in seemingly easy ways?" It could also be that Gen Z workers lack perspective on how long career progression takes, Norfus suggested. "Many Gen Z candidates have been able to effortlessly get food, research a topic or convey ideas — all from their cell phones — which can distort their perceptions of reasonable career timelines," she said. Human resources expert Natalie E. Norfus, founder of The Norfus Firm in Miami, Florida, pointed to parents, the COVID pandemic and the shifting priorities of employers for recent grads' issues. (Natalie E. Norfus / Fox News) The HR expert also encouraged employers to keep an open mind while hiring. "Employers cannot reasonably expect the newer generation, with access to new technologies and information sources, to do things the way we have always done them," she said. Gen Z candidates bring many valuable skills and perspectives to the workforce, Norfus pointed out. "We regularly come across many Gen Z candidates who have owned their own businesses before finishing high school, have incredible analytics abilities, and know how to leverage technology to more efficiently get work done," she said. It is important to re-think the definition of success, Norfus added. "Does it have to align with your personal approach to be considered good? More often than not, the answer is no."" MY COMMENT Some interesting material here for young people......especially those actively looking for that first post-college job. If I was in that group....I hope I would have the awareness to use this to my advantage. I see one reason for this......CELL PHONE CULTURE. We are now dealing with the first generation to be ENTIRELY raised on computers, screens and cell phones. We have all seen it.....the group of people in a bar or restaurant sitting together at a table......all on their cell phones and not talking to each other at all. I find it interesting that I often hear Millennials....complain about the Gen Z workers that they supervise. Even if this info is true.....I know there are many exceptional Gen Z workers out there in the business world.
Some good posts over the past week. I have been able to get some reading in here and there, but not much time to post. Work has been super busy to start off the new year and it's just been a madhouse. Looks like we have seen a bit more red to start off with. I guess I am not overly surprised about it either. It is interesting to see the media just keep fawning over it and build with it. We are back to the old narrative of "This is it...this is what we have been saying....blah, blah." The only thing I could have predicted is how foolish their reaction would be about any sort of pull back. This is the same group that preached doom and gloom for the past year or so while the rest of us kept on climbing the mountain. Who ended up being right? My account and plenty of others here suggest we came out of all of that in better shape.....simply by sticking to our plans. In any case, I appreciate any and all opportunities to pick up more shares at a cheaper price.
As to the post above on college grads and maybe some of the new young guns entering the world of working...interesting. I deal with a lot of current and new employees, both in entry and exit at times. I see a bit of both. The person with good communication skills vs one that does not. I sometimes see folks who are very skilled for a position and lack good communication skills up against a person who has less skill, but excellent in communication. The person with the communication skills and "people skills" wins hands down almost every time. The person with the lesser work skill can be taught, trained, and learn what he or she needs to succeed. The other one lacking communicative skills usually can't overcome their deficiency in people skills. At times I think people skills is a lost art....but those that have it clearly have an edge. In my own life/work experience I have entered the room before to address a particular issue that was a bit out of my wheelhouse. You have to win by establishing confidence. People have to have confidence in your ability to solve an issue. Good communication and people skills have got me through some seemingly impossible tasks. You can be the most talented guy in the room...skill wise, but if you can't convey that by communication....nobody will ever know it.
I like this little article. Easing US Core Inflation Seen Reinforcing Fed Optimism https://finance.yahoo.com/news/easing-us-core-inflation-seen-210000223.html (BOLD is my opinion OR what I consider important content) "(Bloomberg) -- Underlying US price pressures probably continued to recede as 2023 drew to a close, backing up optimism at the Federal Reserve about the path for inflation. The consumer price index excluding food and fuel, a measure favored by economists as a better indicator of underlying inflation, is seen increasing 3.8% in December from a year earlier. That would mark the smallest annual advance since May 2021, and illustrates the progress the Fed has made on squelching inflation that during 2022 clocked in at the fastest pace in 40 years. While price growth is still above the central bank’s goal, the latest readout from officials’ December meeting showed policymakers acknowledge that interest rates have likely peaked, along with a willingness to lower borrowing costs this year. At the same time, officials “reaffirmed that it would be appropriate for policy to remain at a restrictive stance for some time until inflation was clearly moving down sustainably,” according to the meeting minutes. What Bloomberg Economics Says: “We expect deflation in core-goods prices to continue weighing on headline and core — but if firms are successful in destocking inventory, that source of disinflation will abate in months ahead. Ultimately, core CPI inflation will likely prove sticky above the Fed’s 2% average inflation target through 2024, even as the pace of housing inflation slows.” The government’s CPI report on Thursday will be followed the next day by the producer price index. The measure of wholesale inflation, excluding food and energy, is also seen cooling on an annual basis. US central bankers speaking in the coming week include New York Fed President John Williams and the Atlanta Fed’s Raphael Bostic."...... (I have omitted the portion dealing with inflation and economic data around the world) MY COMMENT SO....here is a little preview of the scintillating media topics for next week......CPI on Thursday and PPI on Friday. Unfortunately with these coming at the end of the week....we will be stuck with the FEAR MONGERING all week. More of the same BS.
The FEAR MONGERING topics just go around, and around, and around. Dust them off and bring them back out time after time. Lawmakers will return to Washington with just 11 days to avert a shutdown. No fix is yet in sight. https://finance.yahoo.com/news/lawm...hutdown-no-fix-is-yet-in-sight-123735945.html MY COMMENT Investors that are smart will TOTALLY IGNORE this event. They always are resolved. Usually with a big Christmas Tree, budget buster, of a bill. BUT......they never have any real impact on investors. The only potential impact is if "YOU" aloow the coverage that will no doubt happen to freak you out. As the article says: "BTIG director of policy research Isaac Boltansky recently told Yahoo Finance Live that for now he is advising clients to "push the noise from D.C. out of their investing thought process," The NOISE from the media on this issue will be EPIC....as usual.
I bet a lot of writers and online sites are now scrambling to re-write their lead stories for the week to come in the markets. Good for investors.....but....bad news for sensationalism this week. Now they will all have to get by with the CPI and PPI. Congressional leaders will reportedly announce top-line spending deal on Sunday https://finance.yahoo.com/news/1-us-congressional-leaders-announce-201835391.html AND NOW: UPDATE 2-US congressional leaders announce top-line spending deal https://finance.yahoo.com/news/1-us-congressional-leaders-announce-201835391.html
YES....we are already at the start of EARNINGS. The one topic that is IMPORTANT and MEANINGFUL for investors of all types. An inflation print and bank earnings: What to know this week https://finance.yahoo.com/news/an-i...arnings-what-to-know-this-week-155553563.html (BOLD is my opinion OR what I consider important content) "Corporate earnings season is starting back up on Wall Street. Reports from some of the nation's largest financial institutions and a crucial reading on inflation will greet investors in the week ahead. Thursday morning will feature the Consumer Price Index (CPI) for December, with December's Producer Price Index (PPI) out Friday. The week will close with a slew of bank earnings from JPMorgan (JPM), Wells Fargo (WFC), Bank of America (BAC), BlackRock (BLK), and Citi (C) kicking off fourth quarter earnings season. Stocks enter the fourth quarter reporting period in cooldown mode. After nine-straight weeks of gains, the S&P 500 produced a negative week to start 2024. Over the last five trading sessions, the tech-heavy Nasdaq (^IXIC) was down nearly 4%. The benchmark S&P 500 (^GSPC) fell almost 2% while the Dow Jones Industrial Average (^DJI) slipped nearly 1%. A surprise December jobs report showed the US labor market ended 2023 on largely solid footing. The labor market added 216,000 jobs in December, about 40,000 more than the month prior and ahead of Wall Street's estimates for the latest report. The unemployment rate held steady at 3.7%, a historically low level. Average hourly earnings, a closely watched indicator for inflation and a gauge of how much leverage workers have in the labor market, increased 0.4% on a monthly basis and 4.1% over last year; economists had expected wages to rise 0.3% over last month and 3.9% over last year. "The strength in the wage data argues for the Fed to remain on hold for a while longer," Jefferies US economist Thomas Simons wrote in a note to clients on Friday. "[Average hourly earnings are] running considerably faster than inflation over the past few months. The Fed is pleased with the progress they have made in getting inflation back down to 2%, but continued strength in [average hourly earnings] will make that 'last mile' problem even more difficult to solve." As Simons nodded to, the debate on when the Federal Reserve will cut interest rates continues to brew. Goldman Sachs still sees the first cut coming in March. "We continue to expect three consecutive 25bp cuts in the Fed funds rate in March, May, and June on the back of lower core inflation," Goldman's economics team led by Jan Hatzius wrote on Friday. For now, the market pricing is on Goldman's side, though odds are shifting. As of Friday afternoon, markets were placing a roughly 66% chance of a rate rate cut in March. A week ago, investors had placed a nearly 88% chance on a cut, per the CME FedWatch Tool. Much of the debate around when the Fed will cut centers around how certain the central bank can be that inflation is indeed headed downward toward the Fed's 2% goal. More information on that will come in the week ahead with the December CPI print. Wall Street economists expect headline inflation rose 3.2% annually in December, a slight uptick from the 3.1% seen in November. Prices are set to rise 0.2% on a month-over-month basis, also a slight increase from the 0.1% in November. On a "core" basis, which strips out food and energy prices, CPI is forecast to rise 3.8% over last year in December, a slowdown from the 4.0% increase seen in November. Monthly core price increases are expected to clock in at 0.3%. "On balance, we look for next week's CPI report to show that inflation continues to slow on trend in a way that positions the FOMC to start cutting rates in June," Wells Fargo's economics team wrote in a research note on Friday. "Energy prices were more stable last month and are unlikely to repeat the major declines that occurred in October and November. We expect the disinflation in core goods to continue amid demand normalization, healthier supply chains and the fall in commodity prices from their peak." On the corporate side, fourth quarter earnings season will kick off with heavy hitters. Delta Air Lines (DAL), JPMorgan, Citi, Wells Fargo, Bank of America, and BlackRock are all set to report on Friday morning. Investors will look for updates on consumer spending as well as how financials are holding up amid the higher rate environment. The prospect of Fed interest rate cuts in 2024 could be a boost to bank stocks, according to Wells Fargo analyst Mike Mayo, who covers financials. "You saw with the Fed's pivot in December, bank stocks started to outperform," Mayo told Yahoo Finance Live. "But when you actually see [the Fed rate cuts] happening, I think banks will perform even more. And I think the risk of the downside will be mitigated." The financial sector will provide the first look at how corporates performed in the fourth quarter. Broadly, Wall Street has been increasingly pessimistic on fourth quarter earnings. Since September 30, estimates for S&P 500 earnings have fallen 6.8%, per FactSet. That marks the largest decline since the third quarter of 2022 and sits well above the 20-year average of a 3.8% decline. Deutsche Bank chief US equity strategist Binky Chadha sees a more robust quarter for earnings. But in the near-term, even that might not be a boost to the market, per Chadha, who notes stocks massive end of year rally puts equities in precarious position. "The size of the equity rally during earnings seasons has historically been tied largely to market performance and equity positioning going in," Chadha explained in a note to clients. "Despite the robust growth and strong beats we expect this season, the market rally is likely to be tempered by the solid run up in the S&P 500 since the end of the previous earnings season and elevated (but not extreme) equity positioning." MY COMMENT WOW....increasing PESSIMISM about earnings by Wall Street. Too bad the little retail investors dont get a vote. If they did I would bet that the expectations of us....little people....would usually TROUNCE the predictions of "Wall Street". By "Wall Street"......of course....they mean the big banks and trading houses. Somehow....I think earnings will be just fine.
What's your thoughts on Disney stock? They own 100 percent of Hulu as of Nov Dec 2023. They have a beta thing on Disney Plus called Hulu Beta all shows all over world now Hulu. Check thread on Stockholics. Buying some stock Monday Tuesdays. The bundle for Hulu Disney Plus and ESPN plus is 15 bucks and Netflix basic I had was $16. Dumped Netflix got Hulu Disney Plus and ESPN Plus bundle yesterday.
I personally wouldn't consider it. The trend of large companies that are engrained into peoples everyday life pushing agenda has not worked very well for them. Examples Nike, Disney, Target etc. I have owned Nike shoes, watched Disney movies and run into target for odds and ends but I wouldn't dream of investing in any of them. Also everyone bought streaming services to get away from cable and they are all turning back into cable! Rising monthly fees, have to buy multiple services to get all your content and worst of all COMMERCIALS ARE BACK! I bet I have no less than 5 different streaming services on my home tv. My wife works from home and watches our kid so I don't have an axe in that fight.
As we continue to see WHINING and SKITTISHNESS over a single down week in the markets. An Ineffective Indicator: January’s Returns The January Effect is still a myth https://www.fisherinvestments.com/e...ary/an-ineffective-indicator-januarys-returns (BOLD is my opinion OR what I consider important content) "Well that didn’t take long. After three modest down days to kick off January, headlines are a-tizzy over the January Effect—the long-running myth that January, or its first five trading days, or whatever else people fancy to make things fit, predicts the year’s returns. Even before Thursday’s small rally turned into a small dip, people were fearing Tuesday and Wednesday’s meant this will be a bad year indeed. As with all seasonal saws, we suggest not getting sucked in. No part of January is predictive. Exhibit 1 shows this the simplest way we know how, tallying the number of times a negative January preceded a negative year or a positive year—and the number of times a positive January started a negative or positive year. As you will see, the most frequent outcome was both January and the full year rising. That happened in 52 of 99 completed years since 1925. But the second most frequent was a negative January feeding into a positive year, which happened 21 times. That is more often than the down January, down year combo, which happened 17 times. If a down January failed to predict the year more often than not, then we fail to see the fortune-telling powers here. About all we can glean is that stocks rise more often than not in both months and calendar years, which we would think is already a pretty darned well-established fact. Exhibit 1: So Goes January, Whatever Source: Global Financial Data, Inc., as of 1/4/2024. S&P 500 total returns in January and full calendar years, 1925 – 2023. We suspect the January Effect is getting so much ink now for two reasons. One, it “worked” in 2022, when the bear market started after the S&P 500 and MSCI World Index peaked on January 3 and 4, respectively—and in 2023, when January and the year were up big. Recency bias makes these data points loom large. Two, January’s early stumble seemingly confirms a lot of the latent negativity simmering among investors, making it tempting to extrapolate. It happened with high-ish price-to-earnings ratios, suggesting to those who read into such things that overvalued stocks were necessarily letting some air out. And it concentrated in several recently high-flying Tech stocks, seemingly confirming all the fears that their big 2023 run was an AI hype-induced sugar high. But sometimes volatility is just volatility, and normal volatility often pairs with countertrends, where recent leaders get hit hard. That happened during last year’s correction. Large growth stocks led during the rally through July, trailed as markets pulled back, then led again in the sharp bounce to new bull market highs. They won’t always win, and a shift to value later this year wouldn’t shock us. Perhaps overenthusiasm for Tech and growth will feed into that, but there are some other things we would expect to see if a shift were to have legs, including a re-steepened yield curve and a high likelihood of accelerating lending. Instead, we have a more-inverted yield curve (thanks to long rates’ fall since October) and slowing lending, which favors large growth-oriented stocks over value since they can use their size and lovely balance sheets to self-finance growth. So don’t latch on to any of the reasons you might be seeing for the rocky start and its allegedly predictive powers. It doesn’t mean investors who had free cash from tax-loss harvesting in December are scared of buying. It doesn’t mean fund managers are skittish. It doesn’t mean Tech companies have to put up or shut up—and won’t be able to. Actually, earnings are improving, and with businesses mostly past cutting costs in anticipation of a recession that never came, private investment will probably pick up some, driving future profits. Oh, and this is also an election year, historically bullish for stocks, with S&P 500 returns positive over 80% of the time. We will have a more detailed forecast for you soon, but in the meantime, suffice it to say we think the bull market continues, and sitting on the sidelines because January stumbled out of the gates probably isn’t a wise move." MY COMMENT TYPICAL.....investor thinking and behavior. Everyone is always looking for a MAGIC BULLET in investing. It simply never works.....investing based on MYTH and SUPERSTITION. On the other hand....fundamental investing based on company fundamental data and earnings......proven to work especially over the long term.....is often ignored by writers and investors. Want to know what works for an investor......simple long term investing in the top companies......and.....in the big averages like the SP500. Personally....I dont buy ANY of the investing myths or superstitions.
We hear all the time the BS about....creating shareholder value. USUALLY...in reality it means taking steps in the business to placate and satisfy HUGE shareholders that want to make a quick profit on their investment and dont give a damn about the long term success of the business. In the end....the big "TEMPORARY" shareholder gets their pay-off and the little long term shareholders get screwed as the business or longer term business model is gutted. The Last Shall Be First: Costco's Counterintuitive (But Profitable) Approach to Shareholders Or, how Costco's focus on everything but its shareholders nevertheless leads to outsized investment returns... https://www.kingswell.io/p/the-last-shall-be-first-costcos-counterintuitive (BOLD is my opinion OR what I consider important content) "Costco has been on my mind a lot lately. In part because of CEO Craig Jelinek’s recent retirement — COST -0.01%↓ lifer Ron Vachris ascended to the top spot just yesterday — but also because the company meant so much to the late, great Charlie Munger. Of the many lessons that I’ve learned from Munger over the years, perhaps none is more important than his exhortation to identify the “big idea” from a wide array of disciplines — and, then, to assemble those ideas into a latticework of mental models that can be used to make decisions, big or small, throughout the rest of your life. “You must know the big ideas in the big disciplines and use them routinely,” Munger once said. “All of them. Not just a few. Most people are trained in one model — economics, for example — and try to solve problems in [only] one way.” These words inspired me to look for the “big idea” in everything. From lofty pursuits such as the hard sciences, psychology, and history (as Munger suggested) down to the idiosyncratic success stories of extraordinary individuals and institutions. Which brings me to Costco. The company’s exemplary merits are well known to Berkshire Hathaway aficionados — after all, it’s not like Charlie Munger was ever shy about singing its praises — but a surface-level examination doesn’t tell the whole story. What really enabled Costco’s rise from an upstart Pacific Northwest retailer into the wealth-creating powerhouse that it is today? Or, in other words, what is the “big idea” behind Costco’s success? After much thought, I believe that Costco’s success (and unique culture) boils down to its relentless focus on putting employees and customers first. And, in turn, kicking its shareholders to the back of the line. (Yes, I understand how crazy that sounds. But, please, bear with me for a second.) That’s a sentiment that will make any investor feel at least the teensiest bit uncomfortable — but it’s pretty hard to argue with the results. In Craig Jelinek’s twelve-year tenure as CEO, COST -0.01%↓ shareholders earned a 21.8% compounded annual return (with dividends reinvested). Far better than the S&P 500’s 13.1% mark during that period. But, as Jelinek will explain below, those eye-popping results were achieved due to a laser-like focus on everything but the shareholders. And, because of that, those very same Costco shareholders have profited immensely. By putting the shareholders last, they ended up coming first. (Funny how that works.) Jelinek always preferred to hold his cards pretty close to the vest — granting precious few interviews and media appearances. But, as is my wont, I’ve dug around and found some choice quotes from the erstwhile Costco boss. Allowing him to explain — in his own words — how Costco has opted for the road less taken and chosen to elevate customers and employees over its own shareholders… (1) “We have never been a company that puts the shareholders on top. You have a responsibility to the shareholder — you do — but if you take the shareholder first, you are going to be in it for the short-term. We [initially] had a difficult time [with Wall Street] with the wages that we paid and our refund policy, but we’ve gotten past that because we’ve been able to grow the business.” (2) “Everything that we do at Costco is not to figure out how much we can make — it’s [about] how little we can make and still pay our bills because we want to sell more. We want to continue to lower the price and sell more units.” A lot of companies pay lip service to the importance of delighting customers and taking care of employees. But very few walk the walk better than Costco. Costco creates a perpetual motion virtuous circle by funneling all scale-induced savings back into lower costs for its members. The company has, no doubt, had countless opportunities to pad its margins a little — a move that shareholders would love and customers unlikely to even notice — but Costco steadfastly refuses to do it. As I wrote a few months ago: Whenever Costco discovers some new way to reduce costs, it passes those savings straight on through to the customer. And, therefore, it further entrenches its competitive advantage that little bit more. Nomad Investment Partnership coined this the “scale efficiencies shared” business model. Membership numbers keep increasing because of Costco’s famously-low prices, which leads to both profits for Costco and reduced costs from additional scale advantages, which Costco then uses to lower prices even more, which attracts more members, etc. Rinse and repeat. Everyone wins. (3) “[If] you want to have a good company, you need good people and you have to pay good wages. You have to build loyalty. And we don’t have much of a turnover in our organization. We want people to stay long-term. We want people to make higher wages. We want people to be able to afford homes. It’s just the right thing to do.” (4) “We want to make sure that our employees are at the higher end of the [pay] scale — and we believe that they are at the top end … We want to pay for longevity. We do not want to turn people. We want to keep our employees.” Which made the recent news of Costco workers in Norfolk, Virginia, voting to unionize with the Teamsters a little surprising. Jelinek and Vachris responded via a letter to all Costco employees: To be honest, we’re disappointed by the result in Norfolk. We’re not disappointed in our employees; we’re disappointed in ourselves as managers and leaders. The fact that a majority of Norfolk employees felt that they wanted or needed a union constitutes a failure on our part. At Costco, we take great pride in our relationships with each other. We’re not anti-union, but our core value of “taking care of employees” has never been the result of any union. It’s been part of Costco’s Mission Statement and the foundation of our Employee Agreement from the very beginnings of Costco’s business. If nothing else, that’s a brilliant bit of PR. (5) “If you keep the consumer and your employees [in mind] and do the right thing, things have a way of working out for you. You build trust with your employees and you build trust with your consumer — which is really just common sense and good business.” Jelinek added, “This isn’t rocket science … It’s simple. The hard part is keeping it simple.” Which sounds positively Munger-esque to me. (6) “You take care of your customer, your member. You take care of your employees. You take care of your suppliers. Then, if you do all those things, you’re going to reward the shareholders. That’s always been our philosophy.” (7) “If you get too short-sighted and you want to reward your shareholders as the most important thing, chances are you’re not going to be in business in five, ten, fifteen years. Our view is we want to have a company for the long haul and continue to grow the sales and grow the profits fairly — and make sure there’s always opportunity for our employees to grow.” (8) “We are very paranoid about making sure we always do what’s best for our members.” Costco’s focus on membership benefits has paid off in spades — with a 90% renewal rate and 72 million paid members worldwide. In North America, that renewal number looks even better — clocking in at an impressive 93%. (9) “People know that we have quality merchandise at a very good price. They’re not seconds. They’re not closeouts. It’s quality merchandise that you can buy at most department stores or high-end stores at a very good price.” At Costco, low cost does not mean low quality. All the sweet talk in the world about competitive wages and appreciating customers would mean very little if the merchandise at the warehouses was not up to snuff. Especially for a company like Costco, with its emphasis on lower prices and squeezing out more sales on razor-thin margins. But, happily, that’s not the case. (10) “Trust me, [the $1.50 hot dog and soda combo] is never going to change. If I have to subsidize it personally, it’s not going to change.” (11) “I know it sounds crazy making a big deal about a hot dog, but we spend a lot of time on it. We’re known for that hot dog. That’s something you don’t mess with.” To me, Costco’s $1.50 hot dog and soda combo — seemingly immune to the price pressures of inflation — is the most famous example of how the company “takes care” of its members. (12) “I came to [Costco founder Jim Sinegal] once and said, ‘Jim, we can’t sell this hot dog for a buck-fifty. We are losing our rear ends.’ And he said, ‘If you raise [the price of] the effing hot dog, I will kill you. Figure it out.’ That’s all I really needed. By the way, if you raised it to $1.75, it would not be that big of a deal. People would still buy [it]. But it’s the mindset that when you think of Costco, you think of the $1.50 hot dog and soda.” Jelinek added, “By having the discipline to say, ‘You are not going to be able to raise your price. You have to figure it out,’ we took it over and started manufacturing our hot dogs [ourselves]. We keep it at $1.50 and make enough money to get a fair return.” And, by the way, Jelinek’s concern over the combo’s financial viability was perfectly reasonable. Especially for a company that keeps such a close eye on its costs and margins. But Sinegal recognized how the combo exemplified Costco’s value proposition to its members — and he impressed that fact upon his protege via death threat. Hey, whatever works. (13) “I want to be able to go in the food court, 25 years from now when I’m old with my walker, and sit down and say, ‘I remember you when!’ to some of our employees. That’s very important, to be able to create a company long-term that’s going to continue to grow and provide opportunities. You do that by taking care of the member and creating them great value.” (14) “Success is a lot of different things to a lot of different people. If you can continue to provide value to the consumer, your business is going to continue to grow. [And] if your business continues to grow, you’re going to provide opportunity for your employees. If you can provide opportunity for your employees, your employees are also going to be able to grow. They’re going to be able to support their families — and enjoy a better quality of life. If those things happen, you will just continue to reward the shareholders.” (15) “We want to keep what we do simple. If you start to drift and become complicated, it costs you a lot of money to be complicated.” At Costco, the mission is indeed simple: the customers and employees always come first — even if (in the short-term) that comes at the expense of shareholders. Hopefully, under new CEO Ron Vachris, it will stay that way." MY COMMENT I hope the COSTCO method of doing business never changes. Their simple focus on customer service and great employees is the key. They are as close to any company that I know to being a perfect business model. A great business model and great management focus and execution. Somehow they have avoided the modern trend of the celebrity......incompetent and selfish......CEO.
GREAT investing means.....simplicity, simplicity, simplicity. A total focus on doing the same simple things over, and over, and over, for as long as they work. There’s No Ozempic For Financial Decisions https://awealthofcommonsense.com/2024/01/theres-no-ozempic-for-financial-decisions/ (BOLD is my opinion OR what I consider important content) I’m skeptical of any diet or exercise craze because they all end up more or less becoming fads. This is why I could never get behind the idea of buying stock in Peloton, even though I am a happy user of the product. Sure, some people will buy it and use it regularly. Others will buy it, use it and then stop using it. But there is always another piece of equipment or exercise routine that comes along.1 When it comes to diets there are plenty of them that can work. The problem is not necessarily the diets themselves but the behavior required to stick with them. One study estimates some 95% of all people who lose weight on a diet gain it all back eventually. It’s for these reasons I didn’t pay much attention to the Ozempic and other GLP-1 studies as those results began trickling in. But the more I learned about it the harder it became to ignore. Not only were people reporting weight loss of around 15-20% of their body weight but they weren’t craving as many salty or sugary foods. People feel fuller on the drugs. It lowers heart disease. There were other benefits in addition to weight loss. Subjects reported they were drinking less, smoking less, not gambling as much and even stopped biting their nails. I went from being skeptical to thinking this is some sort of miracle drug. I’m sure there are some side effects and other issues that take away from the miracle label but potential ramifications here are enormous. If the price comes down and a decent percentage of the population begins taking these drugs there is going to be an impact on the agriculture industry, fast food, packaged food companies, the healthcare industry and probably a dozen other industries I can’t even think of right now. I’m not smart enough to sift through all of the potential winners and losers if this happens but this could be real a game-changer.2 Reading about these drugs and the impact they are having got me thinking about how this relates to your finances. There are no miracle drugs that can help you make better financial decisions. You can’t take medicine to save you from FOMO during a bubble. A doctor can’t write you a prescription that will make you feel less envious of the Joneses. You can’t get wrapped in a full body cast that will prevent you from panic-selling your stocks during a bear market. No amount of physical therapy will take the pain away when you go into debt. There aren’t any surgeries to remove the feelings of greed and fear you get from watching your portfolio move up and down during the different market cycles. You get the point. The good news is there are differences between physical health and financial health. I know diet/exercise makes for a good personal finance analogy but it’s much easier to change financial behavior than it is to change your habits when it comes to eating and exercise. Eating right requires you to constantly make decisions — things you should eat, things you should avoid, etc. If you eat three meals a day that’s 21 dietary decisions a week and nearly 1,110 diet-related decisions in a year. Add in all of the food options we have available today and we’re probably talking tens or even hundreds of thousands of decisions when it comes to eating. Exercising requires you to actually get off your ass and do something. You have to move. You have to sweat. You have to lift stuff. And you have to be motivated enough to do it on a regular basis, even when you don’t want to. You can’t automate your physical health. Sure, you can plan out your meals and when you’ll go to the gym but you still have to follow through with it. You can automate the majority of your financial decisions. Bills can be paid automatically. You can pay off your credit card balance every month without ever thinking about by setting up auto-pay. Every time you get a paycheck, you can have funds automatically directed to different accounts for saving and investing — online savings accounts, brokerage accounts, IRAs, 401ks, etc. And once the money hits those accounts it can be invested automatically exactly as you desire. You can put money to work automatically in the asset allocation of your choice. You can rebalance automatically. You can tax loss harvest automatically. You can buy and sell automatically. Maybe someone will create a drug that turns us all into robots in the future but for now there is no way to take the emotions out of your finances. Your emotions aren’t good or bad, right or wrong. They just are. But you can make good decisions ahead of time so you’re not forced to deal with those emotions at times when they can ruin your financial plan with a boneheaded mistake. I spend very little time on my own personal finances because 95% of it is set on auto-pilot. Bills are paid. Contributions are made. Investments are bought or sold. My portfolio gets rebalanced. I still have to make course corrections along the way and check in on occasion to make sure everything still makes sense. But technology makes it easier than ever to take the worst parts of yourself out of the equation when it comes to financial decision-making. And the only side effects of automating good financial decisions ahead of time are rising portfolio balances, higher credit scores, increased savings balances and more time to spend on the things you actually care about.3" MY COMMENT Here in this thread we have hundreds of pages of posts that all boil down to the same thing.......simplicity. KEEP IT SIMPLE STUPID. There is no need to reinvent the wheel. We all know the emotions and behaviors that kill investing results. What works in investing.....never changes. What does not work never changes. AND.....unfortunately....people never change.
A good open today. BOEING is killing the DOW.....that company is a real disaster ever since they turned away from their long term focus on engineering and moved their HQ out of Seattle. Their management....a disaster for years now. Unfortunately they seem to operate like a.....GASP.....government. Total incompetence. The SP500 and NASDAQ....a nice green open.
WOW.....after a bit of waffling and weakness over the past week or two.....NVIDIA...is on a tear today. Currently UP by $20.53 or +4.18%. the stock has JUMPED over $500 to $512 right now. I have not looked at the short term news to see if there is a reason for this one day jump. I really dont care.....about short term reasoning. Hopefully much of this jump is due to some long term thinking about the company and the upcoming EARNINGS.....at least that is my FANTASY. BUT......I will ENJOY the short term action......as will the large number of investors on here that own the company. of course....anyone that owns the SP500.....is a NVDA shareholder. Basically NVDA and the rest of the BIG CAP MONSTER stocks got way oversold in the past week.
One way that I can take a quick look at the LONG TERM performance my personal investing picks....my stocks....is by looking at the percentages in my Schwab account. At the moment my seven stocks make up 66% of my account total. Basically I start all the accounts that I manage at 50/50 between the stocks and the two funds (SP500 Index and Fidelity Contra). It is nice to see that the stocks are handily outperforming the funds and have risen to 66% of the entire portfolio......over the LONG TERM Of course this does not just reflect the current seven stocks....it reflects the results of all the various stocks that I have held in that account for the long term. It also tells me that I am beating the funds....over the long term. Thus.....the two funds serve as a continuous and constant measure of my stock picking and holding success. They also serve as protection against my own personal stock picking and investing BIAS. AND....they also serve to give me a much broader market exposure for a good "chunk"....(investing term of art).... of my money. NOTE....that I intentionally say....."stock picking and holding"....above. People tend to have a lot of focus on "stock picking". But that is only a small part of the battle. Knowing how to hold and for how long is the other big part of the long term investing equation. Avoiding market timing and not churning your own portfolio is a huge part of investing success. You have to have the ability to hold your GREAT stock picks for the long term......and NOT.....jump in and out prematurely. In other words....IGNORE THE SHORT TERM CHAFF. and INSANITY.
