Archives for January 2021
The Fed is Sacrificing Retirees to Save the Banks
You may have heard three cheers from Wall St. recently when JPMorgan Chase & Co. announced its "highest-ever quarterly profit." The bank, America's largest at the moment, got an extra boost by recognizing that some loans it had previously written off were actually going to pay. Good for the bank, right? Sure, but to make it happen the Fed is holding interest rates at nearly zero and sacrificing savers and retirees to save big banks. There are no plans to change course or to have banks share in the pain being suffered by America's savers and retirees. The NY Times reported this morning … [Read more...]
Jim Simons’s Renaissance Technologies vs. Internet Forum Traders
This story is a familiar one if you have been active in the markets for a few decades. It starts with the WSJ reporting on Jim Simons's decision to step down as Chairman of his firm, Renaissance Technologies. As the Wall Street Journal so kindly points out in this morning’s article, Renaissance Technologies public funds had a real ugly year in 2020. They were down 20-30%. Simons is one of the most successful hedge fund managers on Wall Street—ever! Nothing like a parting gut-punch from the most widely read financial newspaper in the U.S after an otherwise brilliant career. Classy … [Read more...]
February RAGE Gauge: Americans Focusing on What’s In Front of Them
You think Americans are feeling elevated risk? You wouldn't know it by looking at the stock market. But how are you doing on a local level? Are you taking small steps every day to secure your situation? You don’t have to change your world in a day. Focus on what's right in front of you. That's what's most important. Here are some thoughts looking out at my backyard: Are you seeing local prices higher or lower? Here, the price for food at the grocery store is up, while remaining pretty steady at restaurants. What isn't going up is the yield you're earning on the S&P 500. Yields are … [Read more...]
Biden Plans to Spend Trillions More on COVID-19 Stimulus
The Biden team has announced that they plan on spending trillions of dollars (in addition to the trillions already spent) on COVID-19 stimulus and recovery. The New York Times reports: With millions still struggling, the initial stimulus package that Mr. Biden will unveil is expected to include money to complete $2,000 direct payments to individuals and aid to small businesses and local and state governments, Mr. Deese said. Others briefed on Mr. Biden’s thinking said he would also call for the first piece of legislation to include extending the duration of benefits for the long-term … [Read more...]
There’s Always a Way Forward for Americans Like YOU
How did you learn how to make money? In reviewing a package of financial documents with a prospective client last week, he included his social security estimates. It was like finding a piece of gold as far as I was concerned. Why? Because it showed me that he began working at age 16. I was able to see what he made of himself during a lifetime of work. It’s better than reading a best seller. I said to him, “It’s nice to see how much you’ve been able to save all these years, but what stands out the most is I see you started working when you were 16-years old.” He replied, “I guess that’s what … [Read more...]
Overtaken By Nvidia, Intel Fires Bob Swan
The Financial Times reports on the firing of Bob Swan by Intel, writing: Intel is replacing its chief executive Bob Swan after a series of manufacturing setbacks and competitive blunders that lost the veteran Silicon Valley company its crown as the top US chipmaker. Mr Swan, its former finance chief who held the top job for just over two years, will be succeeded on February 15 by former Intel veteran Pat Gelsinger, who is currently chief executive of VMware, the infrastructure software group. The company made the move just days before Mr Swan was expected to unveil Intel’s new … [Read more...]
Do You Remember When NASDAQ Dropped by 82%?
If you’re not a client of mine, and know someone that’s loaded with tech stocks, help them take a look at the overlap in their portfolio. Have them look at their mutual funds and ETFs, and read the prospectus. Look at the top ten holdings. Chances are they’re all loaded with the same small group of GROWTH stocks. Remember, even trees don’t grow to the sky. There’s a shelf life, there’s a limit. If you stick with a VALUE approach (you are if you’re with me) then you’re building in discipline, like a New Year’s resolution, by sticking to a plan. Combine this approach with the Prudent Man rule, … [Read more...]
Downcast Small Business Owners Prepare for a Difficult Four Years
The NFIB's measure of small business optimism shows that owners across America are not hopeful about the near-term future. Jeffrey Bartash reports for MSN: The numbers: Small-business owners turned more pessimistic in December than they have been at any time since the onset of the coronavirus pandemic after a record new stage of the viral outbreak and Democratic electoral victories that promise a potentially dramatic shift in economic policy in Washington. The closely followed optimism index compiled by the National Federation of Independent Business fell by 5.5 points to 95.9 last month, … [Read more...]
Don’t Be on Their Radar, Get Out of Debt Now
If they’re going to penalize you for saving, you had better learn how to play their game. Because indebted Americans are their bread and butter. Charging outrageous interest rates on credit card debt and paying zero on savings is one of the ways they stick it to you. And imagine all the information they have on you. It’s scary to say the least. That’s why I want you to stop playing their game. If you’re in debt, I want you to devise a plan to get out of it. Whether it’s a six-month, one-year, five-year, or ten-year plan, I want you out of debt. Because when the world can change literally … [Read more...]