Monthly Archives: November 2015

Successful Investing in Stocks

1. Know yourself.

2. Know the system.

3. Do your homework.

4. Keep history in mind.

5. Acknowledge luck.

6. Stick to your timeframe.

7. Beware of forecasts.

8. Don’t follow the herd.

9. Be flexible

10. Be nimble

Proverbs 11:19

Turn the other cheek

Eye for eye, tooth for tooth.

Money isn’t everything.

Money makes the world go round.

Look before you leap.

He who hesitates is lost.

If at first you don’t succeed, try, try again.

Don’t beat your head against a wall.

Absence makes the heart grow fonder.

Out of sight, out of mind.

The early bird gets the worm.

Haste makes waste.

All good things come to those who wait.

Never put off till tomorrow what you can do today.

Don’t cross the bridge until you come to it.

Two heads are better than one.

Paddle your own canoe.

Terrorism and Interest Rates

The Economy: We’re the quintessential optimists so it’s with the risk of sounding like Chicken Little, that we again note the economic data is weak to mixed. The manufacturing sector is worrisome. Earnings season has ended with the note that corporate profits declined. Higher sales of cars and trucks are due in part to subprime auto loans. (Yep, subprime loans, the red-headed-bastard-sons of the Financial Crisis and subsequent Great Recession) Compounding this fog of uncertainty is the recent spate of terrorist activities. The Beirut bombing, the Russian airline bombing and the assault on Paris have heightened the sense of worry. The Fed released the minutes from their last meeting today. They were interpreted as being hawkish and in favor of interest rate Liftoff in December. Financial markets were ecstatic. But lost in the excitement is that fact that the minutes are pre-terrorist attacks. So we remain skeptical that we’ll see Liftoff in December. The much anticipated 25 basis point (1/4%) hike shouldn’t have much of an impact. It’s the unanticipated consequences that are causing the willies. After a decade of zero interest rates, no one knows what those consequences will be. Now that France has declared war on ISIS those consequences are more unknowable.

Food for Thought: The Russians have had boots on the ground in Syria for more than 40-years. To say that Putin and Company preempt the U.S. in Syria would be a gross understatement. In the aftermath of the Paris attack, the French are reaching out to Russia as an ally. With this diplomatic caress, Russia is on its way to being rehabilitated. Sanctions will quietly go away. Putin, bare-chested astride his white charger, crossbow in hand shooting whales, is the man of the hour.

Veterans Day San Diego

The Economy: The jobs report last Friday came in better than expected Unemployment dropped to 5%; the lowest since 2008. The U.S. economic expansion appears to be on track Yet, there is little consensus on how well the economy is doing. For those saying that this is one of the longest economic expansions in history, an equally vocal group points out that it’s one of the weakest. For those saying that earnings season was strong, others point out that earnings growth is in decline. As we move into the holiday season, attention is beginning to focus on next year. 2016 is just 7-weeks away. Between now and then there’ll be a raft of statistics. But if a lid can be kept on Syria, the Spratly Islands and the European immigration scene, we expect an uneventful end of the year.

Food for Thought: The deep budget cuts known as Sequestration, have been kicked down the road to 2018. San Diego should benefit as increased defense spending flows into the economy. Looking further out into the future, Northrop Grumman has won the contract for the next generation of Air Force bombers. Word is that drone technology will eventually replace the pilots. San Diego is Northrop’s unmanned systems center. As the unmanned models become reality, this should become more of a growth business for San Diego.

Qualcomm (QCOM)

Qualcomm (QCOM) was down 15% after reporting earnings this week. If you had $5 million in QCOM, you lost $750,000 overnight. The premier San Diego company which faces changes in the mobile space, has announced massive layoffs and a stock buyback program. Some are calling for the company to be split up. The carnage in QCOM is the perfect example for why employees should diversify out of company stock in their retirement plans. Stories of employees who become instant billionaires dominate the media. Much more common are employees who are impoverished when their company stock heads south. Just as the odds are against you winning the lottery, they are against you being employed by the next Apple, or Tesla or Facebook. Invest with common sense.

Proverbs 11:1

Life is fragile, be positive.

Do well by doing good.

You deserve everything you have.

If you are not making mistakes you are not alive.

See with your eyes,

There’s no shame in fear; there’s shame in being paralyzed by fear.

You have free will.

Make the choice not to be cynical.

You are as lucky and as blessed as you can be.

Never trifle with someone.

The hardest three words: “I am wrong.”

Resentment cripples you.

Create your universe.

The most important decisions are the things you decide not to do.

Deals with the devil never work out,

Evil consumes itself.

Victims are permanently disappointed.

Understand the snobbery of the poor.

God Laughs

The Economy: Fed Chair Yellen appeared before the House Financial Services Committee. In commenting on the looming interest rate Liftoff, Democratic House Representative Bradley Sherman, Harvard Law School Magna Cum Laude told Yellen, “God’s plan is not for things to rise in the autumn, as a matter of fact, that’s why we call it fall, nor is it God’s plan for things to rise in the winter, through the snow … God’s plan is that things rise in the spring. And so if you want to be good with the Almighty, you might want to delay until May.”

Food for Thought: “Praise The Lord and pass the ammunition.”