Birchtree's Account Talk

[Birchtree]

PessOptimist,

2000-2002 was another difficult time for the buy and hold investor - I refused to participate in the technology bubble and held my dull and boring account making little money but reinvesting my dividends. I started making some DCA purchases in July 2002 and then a few more in October 2002 and then finally a few more on the third bottom of March 2003 - after that it was a nice ride up. 2008 had me bleeding from both wrists all the way down - but I had my emergency stash that I had built up in CDs and plunged everyting in during the fall of 2008 making over 432 purchases of fallen wall flowers and the rest is history. I held my tugboat (TSP) steady with DCAs all the way down and all the way back up - a nice redeemer of any portfolio. This current cyclical bull market is going to last longer than the move from 2003-2007. It's a classic I hate stocks mentality and mom and pop will eventually have to puke their bond holdings and chase the equity market momentum - this bull may run for years and will make me affluent.

I would prefer not to waste my time playing the timing game but is necessary to get past the 100% S fund buy and holds so I can move up the tracker. I'm taking 5% off the S and I funds on 11/30 keeping 90% incase I'm wrong and the market moves higher while I'm waiting for the 90-day cycle to exert pressure to the down side. I'll take another 10% off the S and I fund on or around 12/3 hoping a small consolidation for a few days sets in - then I'll take that 30% G money and go back to work maybe at lower prices and gain a little traction on the tracker. Anyway that's the plan - may work or may not.

 

[Steel_Magnolia]

... so that's the field of dreams I'm playing in. Now a 16% gain from here will really give me a particularly nice kick into the stratosphere.

You got 'em, Birch. I can hear 'em clunking together clear over here. Us chicklets are cheering for you!

 

[Birchtree]

At my age (63) it has taken many, many years to get to where I am financially. I'm not about to let go of the bull's horns. I've ridden many cycles through the years and gained some experience from each one - toughing up the old gut along the way. I may start shooting from the hip but now I'm full time on the trigger. No capital preservation for me - that's why I have a wife - only capital appreciation until my last breath. Now I will pull profits along the way and rebuid my emergency stash - but most of my money will be working not resting out of fear. I paid a dear price in the fall of 2008 and now by gosh it's comeuppance time to reap the gains of holding strong and long.

 

[Birchtree]

"The Sum of All Fear for Investors."

http://www.marketoracle.co.uk/Article24449.html

 

[PessOptimist]

Thanks for the reply.

I stuck my nose in to your house because I was curious about the little timing thing with the funds.

I stuck it in further cause some of the newer members seemed confused by some of the terms you use.

Since 2008 was brought up I thought I should mention 2000-02 just to make sure some of the youngsters are aware the market doesn't always have a good year. I should have added to look at a chart over many years to see the very long term trend.

Making no judgements whatsoever about investment strategies.

I gotta say though capital preservation+wife isn't exactly how it works for me.

 

[Birchtree]

I hope I can participate to do some stock shopping on Black Friday - all I need to make is $71K and the flowers open up providing the nectar of buying power. The more I buy the more potential there is for gains and more buying power. I've only made 67 purchases since 7/31 so I'm behind schedule. But I plan to turn up the juice and step in front of the train. I have plenty of buffer to stay away from any margin calls - margin is not free and has to be earned.

 

[JamesE]

Birch, get rid of that stinking I fund, its holding you back. If only I had joined the tracker earlier and not bailed out of my beloved S this summer, you'd be in my rearview mirror . But, since I let emotion muddy my trades, I'll have to wait.

What do think about small caps in 2011? I may hang for awhile, good ole S fund is taking no prisoners.

 

[Birchtree]

I'm holding 70% large caps and 30% small caps and will stay awhile into 2011.

 

[crws]

I'm holding 70% large cats and 30% small cats and will stay awhile into 2011.

:nuts:

 

[KevinD]

I'm holding 70% large cats and 30% small cats and will stray awhile into 2011.

:toung:

 

[Birchtree]

I think we may potentially be looking at 1995 again in 2011. 1994 was a mid-term election year and after a 3% consolidation into December - the market took off and didn't look back for essentially a year going up 30%.

 

[fcharles81]

I think we may potentially be looking at 1995 again in 2011. 1994 was a mid-term election year and after a 3% consolidation into December - the market took off and didn't look back for essentially a year going up 30%.

That's an interesting assessment; especially with the Bush tax cuts about to expire.

 

[Birchtree]

I believe the Bush tax cuts will be extended permanently along with some other tax cuts to encourage economic growth - just what's needed to stimulate the bull to run like the wind.

 

[fcharles81]

I believe the Bush tax cuts will be extended permanently along with some other tax cuts to encourage economic growth - just what's needed to stimulate the bull to run like the wind.

I agree, but it's not going to happen. I believe that the tax cuts will be extended for 2 years only if the middle class tax cuts are made permanent. There is no way Obama is gonna let the Bush tax be permanent, his base won't allow it.

 

[crws]

I believe the Bush tax cuts will be extended permanently along with some other tax cuts to encourage economic growth - just what's needed to stimulate the bull to run like the wind.

My friend, 30 years of tax cuts have allowed many speculation bubbles and led to a crumbling infrastructure,
while the Gov't bails out capitalist financial institutions and spends nearly half the Federal budget on Defense.
How do you expect that the vast majority of consumers will be able to continue spending
to perpetuate wealth by buying goods and services as wages stagnate?
Higher taxes from those that can afford it is the ultimate investment, when they are directed into infrastructure
that the country as a whole benefits from and not funneled to trans-national corporations
that are the real welfare recipients of billions of our (and your) tax dollars.

Where Your Income Tax Money Really Goes

TNCs’ advocacy for the free-market system is situation specific and self-serving.
Their primary objective is to generate as much money as possible for their share holders
and to do so while expanding in size and influence. By appearing to be promoting
capitalism and, in some minds, thus democracy, TNCs have acquired “the ability to
operate beyond the constraint of any one nation’s laws and regulations in ways that can
be…detrimental to host countries” (Rondinelli, 2003). In short, the market power TNCs
have attained through their false campaign for the free-market system has increased their
influence over the global society and has made them a formidable power.
Often, changes demanded by TNCs opens up poor countries’ economies to the
global economy after having destroyed whatever little stability their economy had. Thus,
in order to attract foreign investment by TNCs, “governments [of developing countries]
have suppressed union organizing to hold down wages, benefits, and labor standards”
(Korten, 1996). These governments have also provided tax breaks, subsidies, and
reduced environmental regulations just to create an attractive atmosphere for TNCs.
In addition to their negative impact on economies around the globe, TNC’s
insatiable desire for profit has damaged democratic principles worldwide. Democracy, at
its most rudimentary level, is a governmental system comprised of individuals who are
given the authority by citizens through elections to make decisions, create laws and
establish institutions that will promote the public interest. This definition of democracy,
however, is practically obsolete when elected officials now design and implement
policies that put the corporate interest ahead of the public interest.

http://www.neumann.edu/academics/divisions/business/journal/Review_SP06/pdf/transnational_corporations.pdf

Ira Recaldo Hobson Jr., The Pennsylvania Institute of Certified Public Accountants (PICPA)

 

[amoeba]

whaddaya think of my new tax plan, brainiac?

I believe the Bush tax cuts will be extended permanently along with some other tax cuts to encourage economic growth - just what's needed to stimulate the bull to run like the wind.

If the cuts don't encourage growth now when we have them, why would that change anything in the future? Maintaining the status quo will do nothing more. How can the status quo be a "stimulus"?

Anyway - it won't work bcz the gov won't have any money. Obama has no idea what he is doing. He should have kept his yap shut. He needs to look at the budget. How bout this for a two part plan?

1. 25% flat tax, on any and all income. No hidden extra tax (i.e., FICA) on poor people's first $100K. No high taxes for rich people. And, finally, no deductions, exclusions, or exceptions, for anyone, for any reason.

No 500K exceptions for home sale profit, no exceptions for forgiven debt if you short-saled. No deductions for anything. No standard deductions. And no grandfathered clauses or exceptions either. It starts now on every dime of every source of income.

Everything is taxed. Inheritance, cap gains, dividends, anything and everything (except deferred income). No muss, no fuss. Everybody get's treated the same.

2. 15% internet sales tax. Anything sold anywhere to anyone in the USA get's the bejeezus taxed out of them. Level up that playing field with the brick and mortars that are acting as "displays" for people to try stuff out, then go home and google it up on Amazon and EBAY. That'll fix yall's wagons.

So whaddya think - Oh Brainiac wizard who never sells?

 

[Silverbird]

Bush tax cuts did not stimulate the economy - the ability to borrow at will from your house did and "emergency spending", including the two wars, were off budget and unseen.
However, the Grand Illusion is over. Plus, businesses did not go into a hiring spree; yes they did not start laying off until things started to go South, but the cuts didn't cause a sudden rise in employment. The problem in this country are payroll taxes and health insurances costs - no other country makes businesses pay to hire people like the U.S. does.

 

[Birchtree]

It looks like a nice body hit today - just going to role with the punches as usual.

"S&P 1200 remains too difficult...for now."

http://www.marketoracle.co.uk/Article24487.html

 

[eccougar]

http://www.bls.gov/cps/prev_yrs.htm

Unemployment rate went from 5.8 in 2002 down to 4.6 2007.

 

[Birchtree]

I believe the Dow bounced off its' 50 EMA intraday when it touched 10,992 - the 50 EMA was at 10,986. So now the worst may be over until the first week in December when the 90 day cycle comes to town. But then again I'm usually early on these cycle movements, but I plan to stick with my strategy.