STOCK MARKET....Bob Brinker said: "Interesting week in the stock market. S&P 500 gaining close to a point for the week, but the Nasdaq gaining close to 1% for the week. And the Nasdaq moving close to an eleven year high.....Now why is that?.... A lot of it has to do with one company. A company which reported spectacular earnings this past week and as a consequence the stock celebrated those earnings by increasing in value to $447 a share.....The stock in Apple was trading in the $30's and it closed Friday at $447 a share...."
APPLE IPod and IPhone....Bob continued: "A lot of this has to do with two new products in the last five years. Products that did not even exist in the long term past of the company.....Those products are the IPhone and the IPad....Thirty-seven million IPhone sold in the last fiscal quarter for the Apple....A total of one hundred eighty three million IPhones since the product was first available in 2007.....The IPad has also grown rapidly...The company sold fifteen point 4 million IPads in the latest quarter....The IPhone and the IPad made up 72% of total Apple revenue in the latest quarter....Which means that Apple is now battling with Exxon-Mobil for the most highly valued company on the market....They can go back and forth...."
AMAZON KINDLE FIRE VS APPLE...Bob continued: "Interesting conference call following the earnings report by Apple this week....Amazon introduced their Kindle Fire for $199 and that's way cheaper than the $499 starting price level for the I-Pad. According to the CEO of Apple, Tim Cook, IPad sales were not hurt by Amazon's Kindle Products. The Kindle has less computing power, and at this time, it does not have features such as the camera that goes with the IPhone....."
APPLE INCOME FOR QUARTER....Bob continued: "The company reported income for the quarter up 118%.....They made over thirteen billion in the quarter....And the McIntosh is still selling. Apple sold five point two million McIntoshes for the quarter.....holiday quarter...Apple is thriving in the mobile phone market...now available on the three largest wireless networks in the USA and in the autumn of this year, they are going to add Sprint..."
Honey EC: Bob Brinker has never recommended Apple on Moneytalk or in Marketimer. However, he has had Microsoft and Vodaphone on his recommended issues list for over a decade.
I-BOND RATES MAY 1ST: Bob expects the base rate to stay close to zero, but it's too early to tell what the inflation rate will be....In the fourth quarter of 2011 there was deflation -- the CPI dropped one tenth of one percent.
HOUSING MARKET: For the third week now, Bob said the housing market is in a "bottoming process."
MARKETIMER FIXED-INCOME PORTFOLIO....Caller Clark from Baton Rouge said that since money market funds are not generating much income, he was thinking of putting about $135,000 in Bob's Marketimer fixed income portfolio "where you have those five different investments and you spread it out across them to generate more income."
Bob replied: "For the listeners, the caller Clark, is talking about the income portfolio that is published on page 7 of the investment letter....I think I'm okay with that as long as you take out at least one year of that since you are going to spend it within a year.....Now you have to understand that is a dynamic portfolio.....that means it's subject to change....We mention that because from time to time, we do make changes....."
Honey EC: Many times, years will go by where Brinker's Marketimer fixed income portfolio never changes. He added Wellesley Income Fund (VWINX) in January 2011 and Doubleline Total Return Fund (DTLNX) May 10, 2011. He lowered the weightings in Vanguard Ginnie Mae Fund (VFIIX) and also Vanguard Short-Term Investment Grade Fund when he made those changes. He also sold all of the Vanguard Inflation-Protected Fund (VIPSX) in his portfolios. Before that, there had only been one change for seven years, and that was in 2003, when he added Vanguard High-Yield Fund (VWEHX). So in my opinion, there is very little reason to wait with bated breath for him to be making any "dynamic" changes very soon. :)
Honey EC: Isn't it amazing how so many callers who have been following Bob Brinker for all of these years, praise him for "helping them out" when he went to 65% cash in 2000, but have no memory whatsoever about how much they lost by following him off the cliff in 2008? Sadly, Bob never has anything to say about missing the biggest bear market of our lifetime.
HOW TO STIFF A BANK WITH A SHORT SALE ACCORDING TO BOB BRINKER....Caller Bill from Florida said he had bought a second home in Bradenton, Florida. He paid $160,000 for this two bedroom, one bath home. The mortgage is $120,000 and the payments are $1,100. It's now worth $60,000 or down 62%. Bill said: "I can pay it off, I have the money."
Bob asked: "What is your net worth?" Bill said: "Probably over $2 million....." Bob asked if any of it was liquid. Bill said: "I have probably $700,000 either in CDs or with an investor."
Bob said: "Here's my recommendation.....Go to the bank and attempt to negotiate a short sale.....The numbers speak for themselves. The bankers will see for themselves that you are 50% under water on your mortgage. They will also see that your monthly payment is very high....I would say go to the bank and try to negotiate a short sale....
Bill asked: "The fact that I have the money somewhere, would they end up saying hey, you can pay that off...."
Bob said: "If I were you -- this is not something -- during your negotiations with the bank, this is not something I would be talking about. I mean, if you want to go into the bank and you want to say, hey guys, I owe you $120, (000), the properties only worth $60, (000) but guess what, I've got $2 million in net worth and $700,000 in liquid assets. If you do that, if you do that, you're not going to get a short-sale. But if you go into the bank and say, hey guys, look at this mess. I owe you $120, it's only worth $60, and it's costing me $13,000 a year, this is awful, please arrange a short sale. If you go in that way, and everything I just said is the truth, then I think you have a shot."
Bob said: "If you can't arrange a short sale, your fallback position is not attractive because that market has not recovered yet.....A lot of the Florida market has not recovered yet. A lot of places have not recovered....Your fallback positions are not attractive.....You either continue to pay $13,000 to own a property or you sell it at the market and you owe the bank the difference.....A short sale to you would be very attractive.....Bob Brinker here. It's Moneytalk.
Honey EC: There were two callers who later tried to point out to Bob that to qualify for a short sale, it has to be a hardship case. Bob repeatedly said that he knew that, but "this is a terrible loan." Bob seemed to forget that the caller had to sign for the loan -- I doubt anyone twisted his arm.
Bob also repeated how the caller had over $2 million in assets and "tons of liquidity," so he clearly remembered that. It was clear to me that in a similar situation, Bob would pull every string he could to deceptively off-load an honest debt that he had committed to -- if he could. Makes me wonder if his million dollar condo in Lake Las Vegas that lost most of its value, has undergone a short sale. (Please check here for more comments on this subject.)
TREASURY DIRECT COMPUTER ONLY NOW (LINK): Caller Elsie from Hawaii, who never used a computer in her life, said Treasury Direct is discontinuing her account and returning $800,000 to her, and was concerned about putting it all in one bank because of FDIC coverage. Bob told her to spread it between four banks. Honey EC: She could also use CDARS and they would do that for her.
RON PAUL....Caller John from Illinois asked about Ron Paul wanting to do away with the Federal Reserve. Bob replied: "I don't agree Ron Paul on eliminating the Federal Reserve....We will become a third-world country if the congress takes over the money supply....Ron Paul does have some good ideas....He does not believe that the United States can afford to be the policeman of the world. I think he's right on that.....He also has some not so good ideas. I think that legalizing drugs is not a good idea...."
DODD-FRANK BILL: Bob said he is against its repeal and thinks that the "people in Washington" who are opposed to it and are for "no regulation" or "no oversight" are "bought and paid for."
COMEDY SKIT FOR THE DAY:
Caller Greg from San Francisco said: "I have a 2008 Shelby that's increased in value from what I paid for it. I just wondered, is there a way to put that into a Roth?
Bob said: "Tell us a little more about this item."
Greg said: "Well, it a 2008 Shelby GT 500 Mustang. I paid $62 out the door with tax and license. It's now currently worth over $80,000. I wanted to take some more money out of my Roth and put it into the Mustang to even increase it further."
Bob said: "Do you drive this dolly around."
Greg: "I do on weekends."
Bob said: "Okay, here's the rule. If you put it in an IRA, then you will be required to distribute it the same year you put it in and you might be liable for a 10% early distribution penalty. This is all in Publication 590, you can check it out. That applies to all collectibles, not just Mustangs.....Happy cruisin.' Chris is with us in Texas...."
Honey EC: Was Bob had by this caller? LOL! Thanks to Jeffchristie for this picture of the Roth-IRA Mustang:
* Bob spent the opening monologue in hour-two talking about the Euro, Greece and the sovereign debt problems.
* The third hour opening monologue, Bob talked about next week's Economic Calendar.
Bob's guest speaker-author today was James Rickards Currency Wars: The Making of the Next Global Crisis (Portfolio) Rickards was a very interesting speaker. As time allows this week, I will post a brief summary of this third hour of the show....
(Don't miss the latest issue of the Bulb Timer posted here.)
27 comments:
TFB
I was also surprised by Bob advice for Bill in New Jersey. First I thought that you need to prove hardship and show that there was no other alternative before you can qualify for a short sale. Second Bob was a former vice president at the Bank of New York. It seems like a rather bizarre statement coming from someone with that background. Finally I think Bill should consult an attorney is he decides to follow through on Bob's advice. If he isn't careful, he could wind up with a new residence in a gated community run by the federal government.
I can't believe bob fell for the prank call about the mustang. So, which of one you did it? That was like a classic howard stern prank call.
Pete
Just how big of sleaze ball, con artist scum bag is Bob Brinker?
I only listen to a small potion, maybe 20 minutes of Bob Brinker’s 01/29/12 show and Bob took a question from a caller who had a home in FL. As I was driving, the particulars evade me,(and HoneyBee can correct my info when she transcribes) that his son was considering moving in an attempting to make the mortgage payments, but the situation was the gentleman purchases the home during the real estate bubble for about 160k, and the home was now worth maybe 60K. But the man revealed he had a 2 million plus net worth and he had about 700k in liquid assets. Bob’s advice, while very good in terms of getting the man most money he could out of the situation revealed a huge problem with Brinker’s total lack of character. Essentially Bob told the man he should approach the bank and attempt to get a short sale and to be careful not to disclose the fact he had 2 Million and 700K of it liquid or the bank would tell him to go pound sand. So when you think abut that Bob is says hey you with 2 million plus in assets and 700K of it in cash equivalents should attempt to weasel your way out of your obligations and defraud the bank by omitting relevant facts!
I men this is unbelievable, here we have a man who bought second home at the height of real estate bubble, had more than enough money to pay for it, and is being advised he should stick the bank (and therefore harm the bank’s shareholders, or if insured ultimately the taxpayer when they bail out Fannie and Freddie.) No one forced that man to buy the home, he obviously thought it was fairly valued when he purchased it and Bob’s advice is to essentially walk away from his obligations!!!
This is unbelievable. How could anyone ever trust Bob Brinker. This proves he is unethical beyond any doubt. What a total low-life slimeball. Brinker has been disingenuous in the past, covering up his actual track record and misleading people but this is out and out an attempt to defraud the bank.
tfb
Honeybee thanks again for the brinker post. Your right about Bob he let me down in 2008 but I did hold my position and recouped most of it back.I agree with earlier post Bob has definitely shown he is unethical and going forward you have to be very careful with his advice and dont take it to the bank especially that one in florida..
Another reason Bob Brinker reads the Buzz:
On Dec 19 I wrote that if Mr B was a stock it would be in serious decline, for aforementioned reasons. The astute host of this blog responded that if such an equity existed (Catbird Seat Holdings? Starship Enterprises?
Page Seven Inc?) it should be sold with the proceeds re-invested in Apple shares, which were available that day at $382. They currently are trading in pre-market at $445, a 16% rise in less than six weeks.
Bob, remembering that prescient advice, opened his show praising both the company and spectacular share performance as if it were one of his stock picks. Could it be he missed both the Great Recession and the #1 tech stock, but still holds MSFT?
To Frankj: Excellent job on the 2nd
issue of Bulb Timer. It is indeed a serious threat to the Marketholder subscription base, which is why Mr B won't be retiring anytime soon.
John: "Your right about Bob he let me down in 2008 but I did hold my position and recouped most of it back.I agree with earlier post Bob has definitely shown he is unethical and going forward you have to be very careful with his advice and dont take it to the bank especially that one in florida.."
John's right. Brinker followers didn't lose any more than the average buy-and-holder. No big deal.
John is also right about that deal in Florida. The bank will shortly learn the borrower has more than enough in cash to pay his debt and will not go for any short sale. He might be able to walk away and let them foreclose but they still could come after any deficiency balance depending on the circumstances. He needs to see a lawyer.
That's why I don't think Brinker ever just walked away from that Nevada condo.
Undawater
undawater said: "Brinker followers didn't lose any more than the average buy-and-holder. No big deal.
John is also right about that deal in Florida. The bank will shortly learn the borrower has more than enough in cash to pay his debt and will not go for any short sale."
undawater,
Sorry, but you are wrong. Those who follow Bob Brinker's buy-and-hold advice lost more than the average buy-and-holder because they have paid him $185 yearly for the past eight years. 8 X 185 = $1480.
And about the short sale. You are no doubt right, the minute the bank looks at their records of his net worth (and you can bet they have it), they will laugh him out of the bank.
What you are trying to spin away is that Bob Brinker repeatedly recommended that the caller TRY NOT TO REVEAL that he had a net worth of a couple of million dollar and $700,000 of it in liquid assets, so he could screw the bank out of a $100,000.
Brinker not only recommended it, he said it was WHAT HE WOULD DO.
"What you are trying to spin away is that Bob Brinker repeatedly recommended that the caller TRY NOT TO REVEAL that he had a net worth of a couple of million dollar and $700,000 of it in liquid assets, so he could screw the bank out of a $100,000."
No I didn't mean to "spin away" anything. Brinker's advice seems pretty silly to me. The first thing the bank will do is ask the borrower for financial statements/tax returns and then he is DOA.
It MAY be possible for the borrower just to walk away from the loan and let the bank foreclose; however, he still MAY be subject to a deficiency balance. It depends on the circumstances and that's why I said he should see an attorney.
Oh btw, as far as counting Brinke's subscription charges for the past 8 years...who cares. That's all minor noise and really detracts from any serious arguments. Petty stuff if you ask me.
Undawater
Fed's Inflation Expectations
Thanks for the Fed's Inflation Expectations. It doesn't look so good for IBonds, TIPS and other inflation adjusted vehicles.
"So the FOMC is saying that it would like inflation to be about 2% annually, but is expecting it only to be 1.4 to 2.0% over the next 3 years. Putting 2 and (less than) 2 together, the FOMC is telling us that, based on its price stability objective alone, the Fed is expecting inflation to be lower than it would like."
Undawater
The caller ask Bob for a back up plan if the bank wouldn't approve a short sale. The caller could always do what Woody Allen did at his bank in this clip.
http://www.youtube.com/watch?v=-UHOgkDbVqc
Jeff,
At the beginning of that video I chuckled, by the end, I was laughing out loud.
Here's the link: Woody Allen Robs a Bank
Apt natural and watch out for my gub. LOL!!!
It MAY be possible for the borrower just to walk away from the loan and let the bank foreclose; however, he still MAY be subject to a deficiency balance. It depends on the circumstances and that's why I said he should see an attorney.
You are missing the point. the point is this guy ws not coerced into buying property he could not afford, he did not need the property he bought it on spec or for enjoyment. Now that it has fallen in value and is no longer convenient he wants to walk away from the obligations he willingly an entered into. choices he had absolute control.
the point is, EVERYONE should be all over Brinker because not only is this dishonest it speaks not only of his lck of character, but if you stand by the lack of character of this nation. What ever happened to honor and being a man of your word? This is disgusting.
the previous comment ending with disgusting was by tfb
"Now that it has fallen in value and is no longer convenient he wants to walk away from the obligations he willingly an entered into. choices he had absolute control." tfb
What's the difference between walking away from an upside down, underwater mortgage and Donald Trump putting companies into bankruptcy 3 times?
Unda
tfb, Trump says it's just good business to walk away from your debts.
"Donald Trump -- or companies that bear his name - have declared bankruptcy four times.
Trump has built an American empire from Las Vegas to New York with towering hotels and sparkling casinos. Forbes estimates he's worth $2.7 billion. But not all of Trump's business ventures have been constant money-makers. In 1991, 1992, 2004, and again in 2009, Trump branded companies or properties have sought Chapter 11 protection.
"I've used the laws of this country to pare debt. ... We'll have the company. We'll throw it into a chapter. We'll negotiate with the banks. We'll make a fantastic deal. You know, it's like on 'The Apprentice.' It's not personal. It's just business,"Trump told ABC's George Stephanopoulos last Thursday."
Unda
http://abcnews.go.com/Politics/donald-trump-filed-bankruptcy-times/story?id=13419250#.TycUL1ZZqo0
Anonymous said...
"Now that it has fallen in value and is no longer convenient he wants to walk away from the obligations he willingly an entered into. choices he had absolute control." tfb
What's the difference between walking away from an upside down, underwater mortgage and Donald Trump putting companies into bankruptcy 3 times?
Unda
Hard to find anyone with bigger Ego's than Trump and Brinker.
If your point is that Brinker is as big a dirt bag and crook as Trump, I have no problem with that. In my book both of them are no better than Bernie Madoff.
Honeybee, thanks again for the work you do in providing a weekly recap of Bob’s radio show.
You detailed a call from Elsie of Hawaii which I thought was curious, and in my mind may need a little more research or investigation.
“Caller Elsie from Hawaii, who never used a computer in her life, said Treasury Direct is discontinuing her account and returning $800,000 to her, and was concerned about putting it all in one bank because of FDIC coverage. Bob told her to spread it between four banks. Honey EC: She could also use CDARS and they would do that for her.”
My problem with Elsie’s call is that it would seem that Treasury Direct is cancelling long term contracts with buyers/holders of paper savings bonds. Those bonds (or perhaps other investments) might be earning an interest yield of 7, 8, maybe 9 percent. It would depend on the age of the investment.
Is the treasury sending her $800K back and saying to her: “Here is your money back since you didn’t go electronic with us. We don’t need your money; we are printing all that we need. Now see if you can get an FDIC insured account that pays better than .05% to 1.0%.”
As I say, curious! Maybe one or two of your knowledgeable posters knows more about the Treasury Direct changes going on. Maybe they would share.
Eagle Claw
Oh! By the way, Bob should have pounced on Elsie and said, “Send me $185 and I’ll show you what to do with your $800K.”
Re: Bill in New Jersey.
Why should rules be different for different people who make bad investments? If someone without other assets is able to pursuade a bank make a short sale, so should a person with more assets.
It's similar logic to principal reduction for those underwater on a mortgage. How does that make sense to reward people who made bad investments and not reward people who made a good investments or decided not to buy because prices were too high.
The rules need to be the same for all and certainly should not favor those who make foolish decisions when they are least able to tolerate risk.
Bob's advise was fine. It certainly should be where Bill should start if others getting benefits of short sales. Bill should not be penalized. There should not be separate sets of rules based on economic class.
Jorge
"Bob's advise was fine. It certainly should be where Bill should start if others getting benefits of short sales. Bill should not be penalized. There should not be separate sets of rules based on economic class."
Oh I don't know about that Jorge. There are all kinds of rules based on differing economic class.
I mean Bill obviously wouldn't qualify for food stamps, welfare or other government assisted programs so why should he qualify for short sale from a government insured bank?
I personally think the bankruptcy courts and lenders should have put Donald Trump completely out of business when they had a chance but they made the business decision to work with him.
There are all sorts of different laws, rules and regulations based on individual economic classes and that's the way it should be.
Unda
So one or two of you think it would be okay for a person who buys a second home in Florida, probably for a rental or vacation home, and when the market goes against him to use subterfuge to get out of a loan that he contracted for with a bank?
In my opinion, TFB said it best: "This is unbelievable. How could anyone ever trust Bob Brinker. This proves he is unethical beyond any doubt. What a total low-life slimeball. Brinker has been disingenuous in the past, covering up his actual track record and misleading people but this is out and out an attempt to defraud the bank."
It's about honesty, integrity, trust and keeping one's word. It's about HONOR!
As for your using Donald Trump to justify Bob Brinker advising this caller to not be truthful with his bank, you can do that if you also use Bernie Madoff to justify Brinker misleading his subscribers about his market-timing skills.
"As for your using Donald Trump to justify Bob Brinker advising this caller to not be truthful with his bank, you can do that if you also use Bernie Madoff to justify Brinker misleading his subscribers about his market-timing skills."
Not so. What Trump and Brinker did/do is not illegal.
Bernie Madoff operated the world's biggest Ponzi scheme from the start and is now serving the rest of his life in prison for it.
BIG difference.
Unda
Nope, we are not talking about legality here, although if Bill succeeded in decieving the bank about his net worth, that might be illegal -- I don't know.
We are talking about morality, decency and integrity. What Bernie Madoff did showed none of those virtues. Bob Brinker's advice to Bill on Sunday also showed none of those virtues.
This discussion and all this defending of Brinker and his disgusting advice is very revealing.
Keeping one's word means nothing to many today. Keeping one's fortune is paramount.....It's VERY SAD and does not bode well for this country.
"Keeping one's word means nothing to many today. Keeping one's fortune is paramount.....It's VERY SAD and does not bode well for this country."
You maybe be right Mz. Bee but riddle me this.
What about the person who has an upside down, underwater mortgage or a marginal, money-losing business. Should they continue to struggle pay their loans even if it means severe hardship...or should they seek protection through a short sale or even bankruptcy?
Would you vote for a man who has voluntarily taken his businesses into bankruptcy FOUR times in order to gain more favorable terms?
This is the man whom all the Republicans are deathly afraid of.
Your "riddles" are seemingly endless and certainly pointless.
Caller Bill said he had a net worth of $2 million, and $700,000 of that was in liquid assets. He also said he could continue to make the payments and could also pay off the loan.
What Bob Brinker was advocating was for him to cheat and lie by omission in order to get out of a contract that he had signed.
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