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Archives for May 2019

May RAGE Gauge: Time to Salt Away some Gains?

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You can thank the Trump economy for this stock market. It’s nothing short of a miracle. That’s why it’s a great time for you to review where you stand with your portfolio. Have you considered taking some of your gains and salting them away in bonds in preparation for tougher times ahead? Don’t forget I want you to “Thrive and Survive” no matter what comes our way. Originally posted on Your Survival Guy. … [Read more...]

The Most Frequently Asked Investor Question

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Throughout my years in the investment industry, the question most frequently asked by clients is probably “How are we doing?” In June 2015 I explained how I answer that question. I wrote: How Are We Doing? Throughout my first 28 years in the investment industry, I worked in the trenches, talking daily with clients and the financial media, as well as speaking at investment seminars around the world. All that changed in 1992, when I decided to move off the front lines and concentrate exclusively on research and writing, and Debbie and I moved to Key West, only 90 miles from Cuba. Hard to … [Read more...]

Your Retirement Life: Choosing Where to Retire

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Newport County’s municipalities run seven pension plans. Two of the plans, the Portsmouth pension plan and the Newport firefighter’s pension plan were only 57.2% and 51.4% funded as of July 1, 2017. In July, 2018 they improved slightly thanks to the stock market. If that weren’t scary enough, here’s a quote from one administrator: “If the market keeps doing what it’s doing, we’ll be out next year (60% funded). If not, by 2021. We’ll be 100% funded in 2041”. This is on the heels of a record stock market. On the same front page of The Newport Daily News: “City’s Schools Face Funding … [Read more...]

Is Lithium Stable Enough to Lead the Battery Revolution?

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Lithium based batteries are the best mass-production batteries in the world today, but they have a nasty habit of exploding. Can engineers solve the batteries' problems or is a new approach needed? Bloomberg's Brian Eckhouse and mark Chediak report: Another lithium-ion battery has exploded, this time at an energy-storage complex in the U.S. At least 21 fires had already occurred at battery projects in South Korea, according to BloombergNEF. But this latest one, erupting on Friday at a facility owned by a Pinnacle West Capital Corp. utility in Surprise, Arizona, marked the first time it has … [Read more...]

How Many “Retirees” Will Keep Working?: Some Just Won’t Stop

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Today, Bloomberg's Stephanomics podcast analyzes a theme I've been writing about for a while, the question of How Many “Retirees” Will Keep Working? The podcast discusses the plight of many Americans who are old enough to collect Social Security, but can't live comfortably on the amount of money they receive, along with what they have saved. So, these older Americans just keep working. Scott Lanman described the podcast here: Many older Americans are living longer and are happy to keep working. Others can't afford to retire. Those are just a couple of the reasons why people over age 65 are … [Read more...]

Lumber Prices Chopped Down by Bad Weather

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Bad weather in some key housing markets had tempered demand for lumber, as builders are slowed down. Some big mill owners have even trimmed their output in the face of lower product prices. Ryan Dezember reports for The Wall Street Journal: Lumber prices typically rise in the spring as builders stock up for construction season. But this year, they are being hit hard by bad weather and a decline in home building. The slump comes a year after lumber prices reached record levels and were climbing higher amid a resurgent U.S. housing market, a boom in spending on home renovations and … [Read more...]

Will Amazon Upend the Freight Market?

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Amazon is opening up its internal shipping network to third parties. That could have a major effect on the American transportation market, and on Amazon's bottom line. Jennifer Smith reports for The Wall Street Journal: Amazon is offering beta service for truckload shipments in Connecticut, Maryland, New Jersey, New York and Pennsylvania through its Amazon Logistics arm. It also provides instant rate quotes through an online portal, freight.amazon.com, saying users can “tap into the scale of Amazon as we extend our carrier network to give you best-in-class service at great … [Read more...]

Miss This Investing Concept to Your Everlasting Sorrow

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Lack of patience, more than anything else, hamstrings investors in their pursuit of profits. I wrote in July 2004 that impatiently trading in and out of equities with no eye toward compound interest will bring investors everlasting sorrow. Compound Interest and You Here’s a compound interest story that should help you and your spouse. Let’s assume a hypothetical $10,000 investment with a 7% annual return for 20 years. Investor A draws the 7% ($700) each year for living expenses. At the end of 20 years, the original $10,000 in capital remains in place, and $14,000 in simple interest has … [Read more...]

Does Private Equity Race for the Exit Spell Trouble?

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Stephen Gandel, writing for Bloomberg, explains that private equity companies have shortened the amount of time they spend invested in American companies in 2018. He writes: Private equity firms appear to be signaling “Last one out is a rotten egg.” If those powerhouse investment firms smell something fishy, other investors should take notice. Holding periods — the amount of time between when a buyout firm makes an acquisition until it flips the company back into the public markets or to another buyer — have been drifting down for the past few years around the world. Last year, though, … [Read more...]