Friday, December 31, 2010
Blog October 6th 2010
I’ve been asked many times to restart my stock market, investment, and market predictions blog. Although I love doing it, my interests lay elsewhere right now. See comments for the entire post… I’m 100 percent out of stocks, not because I don’t think there is value there, but it requires far too many hours of time at this point in my life. Publishing, editing, writing, co-authoring, and my returned kid and grandkids are time consuming; Time I happen to enjoy for the “most part.”
I’m also working on a new book series in a totally different area of investment that has greater wealth building potential than the markets. In my mind the stock market is a “been there/done that” kind of thing for me at this point.
I wrote DDB on a whim and had no idea it would receive so much success. Which somewhat pissed me off, my fictional work required years, and that little ditty was a, “14 days to publication” work. It is and has been in the top ten on Amazon for too many damn weeks to count anymore, 62 plus weeks at #1 bestseller. So like a song writers, I’ll let that one ride until it peters out and a newly revised, and or second book is called for.
For those of you who have harangued me on Amazon about book three of the Lollipop trilogy; “The CandyLand” all I can say is, it is penned, and at 95,000 words and 640 pages. That is far too wordy in this kind of market for a book; the old norm used to be 400 pages and has dropped to 300 or under, dilemma.
The original Lollipop was 1100 pages (edited down to 650 pages, two parts) and I have a drawer full of rejection slips to prove that is far too long in today market. All I can say is Candyland is coming be patient please. If you want a taste go to novelmaker.com/ jdarrollhall/ The Candyland and read the 5 star rated opener, 50 pages, it’s free.
All that answered; here is the markets blog thru last and 1st quarter of 2011…
Disclaimer: 1. Do not under any circumstances use the following opinions in any manner whatsoever until you have sought the advice of your legal, financial, and accounting advisors.
2. Do not try the DDB approach unless you read the book, understand and practice the tactics of this strategy. You “will lose money” if you do not understand its principles and what is behind them.
October, 6th 2010 blog
My market ideas have to somewhat agree with a bit of what Buffett has said for the last six months. Except it must be paired down for the small investors, stock will remain the better buy right now over bonds. The only factors that will change that are if the tax cuts for middle class going forward and the rich bracket go up the 4% it is scheduled for. If the tax rate to GDP which is at 15% remains flat (no changes), expect stocks to climb, a 12 or 12,500 DOW is not unrealistic. That scenario would mean that all the tax cuts stay in place, good for stocks bad for the overall economy.
The market is split and priced at about even, Bull and Bear are opposite on which event happens. Half think the cuts will just lapse and revert to the original rates and the other half thinks all cuts will go forward. Right now the market is priced on a 2/1 margin for some cuts and if that happens the market will rally to Bonds. If that the case, gold, oil, stocks, currencies, and commodities will drop. The dollar however will rise against most other currencies.
More revenue against GDP will reduce debt, and make bonds and treasuries far more desirable. If you still remain in stocks look for the solid blue chip dividend payers (AT&T, Verizon, and so forth) to rally short term. AT&T should hit target and be at .61 cents or even a bump which is a 6% Apr payout. Be careful not to hang on too long after the next dividend payout, what you make in taxable dividend you may lose in share price on the down swing.
Tech will gain over the shopping season, and hard goods will fall this year, lack of housing demand and fear will rule that sector. Transportation will suffer, most big retailer are “in place” inventory wise for a 2% gain over last year. Airlines will be flat or on a downturn, ‘election and tax fears.’
A two percent bump in retail will be promising for a few micro sectors; that mean roughly 3 million part time workers would return to payroll for a short time thru the holidays. That is roughly 30 billion additional dollars in addition to the 2% of 4.5 trillion in retail sales increase (100 billion) which should after it all shakes out in mid January be better than average earnings for major retailers and a boon for online retailers. This is a good year to stick with the top ten in each market, Wal-Mart, Kohl’s, Amazon, EBay, Apple, Microsoft…etc. And if the companies you choose pay a reasonable dividend, then it is a double bonus. 1st qtr of 2011 should see GDP up in the 5% growth range, (on tax hikes for the rich).
First quarter, Current-dollar GDP increased 4.8 percent
Second quarter Increased 5.1 percent
Best guess 3rd qtr is 4.1 percent
best guess 4th qtr is 6.9; this will be a good Xmas!
In relation to expectations!
Stay away from home builders, construction, (unless they build overseas), rail, trucking, shipping (except UPS & Fed-X), Pharma, Medical, Insurance, banking-finance… Good luck
If you have been watching the DOW you should have seen that the market has been cyclical, (not volatile) as I predicted last year. If you want a better explanation of that term, consider it a bent bicycle wheel with a playing card at one of its points. The card will rotate up and down in a sporadic rhythm. All the laws of the book will still apply, but the waves are harder to catch and ride.
The basement will remain at 9500, the ceiling at 11,000 with floor at 10,500. Unless the tax situation I describe above happens, that is the key factor to watch for. The rules of this game are simple; more money flows in, the market value goes higher, money goes out, it lowers. If the market moves to bonds, (higher taxes for the rich, lower nation debt) a lower bar will be established, less money in the market. The first sign this is happening is a flattened wave pattern, small rises followed by small retractions.
Warren Buffett tells CNBC he doesn't buy the argument that raising taxes for the rich would derail the nation's economic recovery.
In a taped interview with Becky Quick, Buffett says that while $250,000 in annual income is not necessarily his definition of "rich", he does think it is a "little obscene" that the tax system has gotten "tilted toward guys like me" over the last 20 years.
"When a country needs more income, and we do -- we're only taking in 15 percent of GDP ... they should get it from the people that have it."
• WARREN BUFFETT TO CNBC: "WE'RE STILL IN A RECESSION"
• U.S. CAPITALISM'S 'REGENERATIVE CAPACITY' MORE IMPORTANT THAN GOVERNMENT STIMULUS
• COMPLETE INTERVIEW TRANSCRIPT
While Buffett acknowledges that a compromise may become necessary, he thinks President Obama should be "pretty tough" on insisting that the expiring Bush-era tax cuts are extended only for the middle class and not the rich.
I’m also working on a new book series in a totally different area of investment that has greater wealth building potential than the markets. In my mind the stock market is a “been there/done that” kind of thing for me at this point.
I wrote DDB on a whim and had no idea it would receive so much success. Which somewhat pissed me off, my fictional work required years, and that little ditty was a, “14 days to publication” work. It is and has been in the top ten on Amazon for too many damn weeks to count anymore, 62 plus weeks at #1 bestseller. So like a song writers, I’ll let that one ride until it peters out and a newly revised, and or second book is called for.
For those of you who have harangued me on Amazon about book three of the Lollipop trilogy; “The CandyLand” all I can say is, it is penned, and at 95,000 words and 640 pages. That is far too wordy in this kind of market for a book; the old norm used to be 400 pages and has dropped to 300 or under, dilemma.
The original Lollipop was 1100 pages (edited down to 650 pages, two parts) and I have a drawer full of rejection slips to prove that is far too long in today market. All I can say is Candyland is coming be patient please. If you want a taste go to novelmaker.com/ jdarrollhall/ The Candyland and read the 5 star rated opener, 50 pages, it’s free.
All that answered; here is the markets blog thru last and 1st quarter of 2011…
Disclaimer: 1. Do not under any circumstances use the following opinions in any manner whatsoever until you have sought the advice of your legal, financial, and accounting advisors.
2. Do not try the DDB approach unless you read the book, understand and practice the tactics of this strategy. You “will lose money” if you do not understand its principles and what is behind them.
October, 6th 2010 blog
My market ideas have to somewhat agree with a bit of what Buffett has said for the last six months. Except it must be paired down for the small investors, stock will remain the better buy right now over bonds. The only factors that will change that are if the tax cuts for middle class going forward and the rich bracket go up the 4% it is scheduled for. If the tax rate to GDP which is at 15% remains flat (no changes), expect stocks to climb, a 12 or 12,500 DOW is not unrealistic. That scenario would mean that all the tax cuts stay in place, good for stocks bad for the overall economy.
The market is split and priced at about even, Bull and Bear are opposite on which event happens. Half think the cuts will just lapse and revert to the original rates and the other half thinks all cuts will go forward. Right now the market is priced on a 2/1 margin for some cuts and if that happens the market will rally to Bonds. If that the case, gold, oil, stocks, currencies, and commodities will drop. The dollar however will rise against most other currencies.
More revenue against GDP will reduce debt, and make bonds and treasuries far more desirable. If you still remain in stocks look for the solid blue chip dividend payers (AT&T, Verizon, and so forth) to rally short term. AT&T should hit target and be at .61 cents or even a bump which is a 6% Apr payout. Be careful not to hang on too long after the next dividend payout, what you make in taxable dividend you may lose in share price on the down swing.
Tech will gain over the shopping season, and hard goods will fall this year, lack of housing demand and fear will rule that sector. Transportation will suffer, most big retailer are “in place” inventory wise for a 2% gain over last year. Airlines will be flat or on a downturn, ‘election and tax fears.’
A two percent bump in retail will be promising for a few micro sectors; that mean roughly 3 million part time workers would return to payroll for a short time thru the holidays. That is roughly 30 billion additional dollars in addition to the 2% of 4.5 trillion in retail sales increase (100 billion) which should after it all shakes out in mid January be better than average earnings for major retailers and a boon for online retailers. This is a good year to stick with the top ten in each market, Wal-Mart, Kohl’s, Amazon, EBay, Apple, Microsoft…etc. And if the companies you choose pay a reasonable dividend, then it is a double bonus. 1st qtr of 2011 should see GDP up in the 5% growth range, (on tax hikes for the rich).
First quarter, Current-dollar GDP increased 4.8 percent
Second quarter Increased 5.1 percent
Best guess 3rd qtr is 4.1 percent
best guess 4th qtr is 6.9; this will be a good Xmas!
In relation to expectations!
Stay away from home builders, construction, (unless they build overseas), rail, trucking, shipping (except UPS & Fed-X), Pharma, Medical, Insurance, banking-finance… Good luck
If you have been watching the DOW you should have seen that the market has been cyclical, (not volatile) as I predicted last year. If you want a better explanation of that term, consider it a bent bicycle wheel with a playing card at one of its points. The card will rotate up and down in a sporadic rhythm. All the laws of the book will still apply, but the waves are harder to catch and ride.
The basement will remain at 9500, the ceiling at 11,000 with floor at 10,500. Unless the tax situation I describe above happens, that is the key factor to watch for. The rules of this game are simple; more money flows in, the market value goes higher, money goes out, it lowers. If the market moves to bonds, (higher taxes for the rich, lower nation debt) a lower bar will be established, less money in the market. The first sign this is happening is a flattened wave pattern, small rises followed by small retractions.
Warren Buffett tells CNBC he doesn't buy the argument that raising taxes for the rich would derail the nation's economic recovery.
In a taped interview with Becky Quick, Buffett says that while $250,000 in annual income is not necessarily his definition of "rich", he does think it is a "little obscene" that the tax system has gotten "tilted toward guys like me" over the last 20 years.
"When a country needs more income, and we do -- we're only taking in 15 percent of GDP ... they should get it from the people that have it."
• WARREN BUFFETT TO CNBC: "WE'RE STILL IN A RECESSION"
• U.S. CAPITALISM'S 'REGENERATIVE CAPACITY' MORE IMPORTANT THAN GOVERNMENT STIMULUS
• COMPLETE INTERVIEW TRANSCRIPT
While Buffett acknowledges that a compromise may become necessary, he thinks President Obama should be "pretty tough" on insisting that the expiring Bush-era tax cuts are extended only for the middle class and not the rich.
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