After years of an unabated bull market in tech stocks, investors may be finally beginning to take note of the shortcomings in tech shares. Bloomberg's Lu Wang reports that after the tech-focused Nasdaq index fell more than 1% on Monday, some analysts are calling out the sector's risk. Wang writes: Mike Wilson at Morgan Stanley on Monday reiterated his bearish call on tech high-flyers, urging investors to seek safety in shares with cheaper valuations as the market is likely to be headed for the biggest correction since February. While the magnitude of losses is no worse, the pain for active … [Read more...]
Archives for July 2018
A Japan-Sized Hole in U.S. Pensions
If you have been following my writing for any length of time, you'll know that I have been loudly and regularly sounding the alarm bell on the pension systems of America's cities and states. Here is a sampling of the pieces I have written on the subject: Pensions are Still Hiding from the Truth Dangerous Rules Make American Pensions Riskier Pensions Should be Fearful Pensions: Left on the Hook will be the Taxpayer Pensions in a Load of Trouble Today, Sarah Krouse reports for The Wall Street Journal that the pension hole in the United States for cities and states is the size … [Read more...]
Has Social Media Already Peaked?
Is it over? Has social media already peaked? After revolutionizing the way people share information with each other, is the era of growth for social media companies over? Last week was a disastrous one for Facebook and Twitter, the two best known social media platforms. Yoree Koh and Michael Wursthorn report for The Wall Street Journal: Twitter said Friday that its number of monthly users dropped in the second quarter and could continue to fall as it purges fake accounts, results that echoed Facebook’s bombshell guidance Wednesday that its growth is expected to slow through the end of … [Read more...]
Grave Concerns about Annuity Survival
I have grave concerns about the survival of annuities. I like what Dennis Beaver writes at the Hanford Sentinel: For anyone thinking of moving a large amount of money from a retirement account into an insurance annuity at this time, it could be a terrible decision. “You’ve got to think this over very carefully. Do not be conned by a salesman looking only for a huge commission on the sale of an annuity, and, absolutely do not put all your eggs in one basket!” warns New York attorney Edward Stone. As one of a handful of lawyers in North America who specialize in life insurance/annuity … [Read more...]
Is There a Better Way to Buy Used Cars?
Heading into a used car dealership can often feel like voluntarily entering the gauntlet. No one looks forward to the pressure and intensity such a trip can generate. That could be why Americans are looking for different ways to buy used cars. One of the ways they've found that seems to be working for them is buying their cars from Costco. Costco members can participate in what's known as the Costco Auto Program. Mark Matousek explains the program at Business Insider: In the past five years, over 1 million Costco members have purchased a vehicle through the program, which allows members … [Read more...]
Investing with the Hard-Hitting NFL-style of Paul Brown
The NFL has a lot in common with investing. Both can be rough sports. You can get beaten if you’re not at the top of your game. That’s why a methodical approach is necessary to win both on the field and in the markets. Back in 2002 I wrote about the inspiration former Cleveland Brown’s football coach Paul Brown has given me during my years of investing. Read on about how Brown used a focused, methodical approach to build a football dynasty. Former Cleveland Brown’s coach, the legendary Paul Brown, was a full professor. And Professor Brown taught his football players a systematical/methodical … [Read more...]
The Biggest Stock Market Wipe-out in History
Facebook's shares cratered yesterday, racking up the biggest single-day wipe-out in stock market history. The company lost $119 billion dollars of market capitalization in a single day. There are fewer than fifty stocks in the U.S. that have a total market value of $119 billion. Zuckerberg's fortune fell by almost $16 billion yesterday. Sophie Caronello reports at Bloomberg: It’s official. Facebook Inc. just had the biggest stock-market wipeout in American history. Shares tumbled 19 percent on Thursday to close at $176.26 after sales and user growth disappointed investors. The drop … [Read more...]
There’s a Better Way than Facebook
Yesterday, investors in Facebook stock had the entirety of this year's gains wiped out in a flash. The quarterly earnings crowd on Wall Street pulled the chair out from under Facebook after receiving bad news on the company's growth. It's that sort of volatility that conservative, retired or soon to be retired investors should attempt to avoid. Getting hit with a 19% loss in one day is hard to stomach when you have no new income coming in, and don't have time to recoup those losses. There's a Better Way to Invest than in Volatile Tech Stocks A better way to build a portfolio you can … [Read more...]
Crisis at Vanguard: Part II
Vanguard Closes Wellington Advisory, Institutional and Advisory Shares to New Investors No, it is not the end of the world, but if you are a loyal Vanguard investor, as am I, having one of the few mutual funds in the world I advise for purchase close is a “Vanguard Crisis” for me as well as for many individual investors. How is this “Crisis at Vanguard” going to play out for the individual investor? I have been anticipating this “Crisis at Vanguard” for a long time. And it is going to become a broadening industry crisis, not just a “Crisis at Vanguard.” The handful of big mutual … [Read more...]
Lawmakers, Guns and Money
Big boosts to defense spending are building up backlogs at government military industrial contractors like Lockheed Martin, reports Doug Cameron. Orders for F-35s and THAAD missile systems are booming. Cameron writes in The Wall Street Journal: The world’s largest defense company by sales has been a prime beneficiary of Congress boosting Pentagon spending above requests from the White House in an effort to replace worn-out equipment and address an array of threats, including North Korea’s nuclear program and military buildups by Russia and China. Investors have fretted that defense … [Read more...]
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