December 9, 2012, Bob Brinker's Moneytalk: Summary, Excerpts and Commentary

December 9,  2012....Bob Brinker hosted Moneytalk today....(comments welcome)

I was not able to listen to Moneytalk today because I was busy this afternoon.  The Handbell Choir that I belong to was performing a Christmas program -- along with a Chorale Group.

But lucky for us, Jeffchristie listened to the program and compiled a brief summary. I spoke to Jeff, who lives on the opposite coast from me,  just before posting this  and he told me that Brinker did not say anything that would indicate any change in his market-timing outlook.

Jeffchristie's Moneytalk summary:

Bob started the program talking about Friday's jobs report. He said it was a decent number but not a fantastic number. It is big enough to keep unemployment from going lower. Bob gave the unemployment numbers for racial groups and by education level.

Bob also said that a soap opera about the fiscal cliff was going on in Washington. He praised the efforts by Ben Bernanke to improve the economy.

The first caller was Steve in Colorado. He was worried about going over the fiscal cliff. He is 55 years old and in a 35% federal tax bracket. He wanted to take early withdrawal from his 401k and use the money to pay his mortgage. Bob said he would be losing 50% of his money to penalties and taxes and advised him against doing it.

Bill called in from Wichita Kansas. He wanted to know if it was a good idea to buy stocks before they go ex-dividend. Bob explained to him that the stock is adjusted downward by the cost of the dividend and that there was no advantage by doing what he ask about.

Bob mentioned that California has the highest state income tax at 13.3% and Hawaii is second at 11%.

Don from Chicago was next. He had an idea to free up some money to help the economy. He suggested allowing people under 59 1/2 to take tax free withdrawals from their retirement accounts. Bob said it would be OK if they used the money to buy a first time house but didn't like the idea if the money was used for other purposes.

Pete called in from Seattle. He was a long time subscriber and thanked Bob. He still had significant holdings in a Ginnie mae fund and said he was willing to accept a 10% drop in NAV. He knew that Bob had reduced his allocation and ask if he should also do the same. Bob said it was OK to maintain his position.

Bonnie from Birmingham said she has 85% of her 401K in stocks and thought she should lower her exposure. She told Bob she was 63 years old. He recommended she sell on strength and go to 50/50.

Martin called in from Fairbanks. He is semi retired and has 40% in stocks, 50% in bonds and 10% in cash. Bob said he was comfortable with that allocation.

Mike from Colorado said the problem with the federal budget deficit was spending. Bob agreed with him.

Burt in Gulfport, Mississippi wanted to withdraw money from his 401k to build a new home for his retirement. Bob ask if he would be subject to any penalties. He said no and Bob said he didn't have a problem with him doing it.

Joe in California wanted to know if Apple was a good buy since he has dropped from its all time high. Bob said he didn't have an opinion on the stock. He mentioned that he sold all of his NASDAQ holdings in October.

Joyce in Iowa ask about the wash sale rule. Bob told her that she had to wait 31 days to buy back a stock that has a loss. If she books a gain it can be bought back at any time.

Charlie in Albuquerque is nervous about the fiscal cliff. He is worried that his taxes will be going up. He has an annual income of 80K and Bob told him that he doesn't think there will be any change when all is said and done. Charlie is also thinking about selling his stocks. Bob said it depended on Charlie's risk tolerance.

Dan in Washington a long time listener said he would be receiving 42K a year in pension benefits and he had 470k in equities in retirement accounts. Bob said he was OK with that asset allocation.

Jamie in Santa Clara was worried about inheritance taxes. She said her house was worth about $1,000,000. Her total net worth is around $3,000,000. Bob thought she would be OK after everything gets worked out. One proposal currently being considered was for the tax to start at $3.5 million.

Jim in Henderson is thinking about selling stock to lock in capital gains at the current 15% rate.

Tom in Virginia beach pointed out that raising taxes on the top earners will do little to reduce the annual deficit.

Edward in Cheyenne Wyoming said he recently read an article on Bloomberg that talked about making municipal bonds taxable. Bob thought that this would be a bad idea.

FrankJ sent a few comments about the Apple Stock call today:

Frequent caller Joe took a short ride on the MoneyTalk trolley today at 13 minutes into the 2nd hour. Joe wanted to know if Apple was a good buy at $532.

Bob professed to have "no opinion" on the stock. But he "wished all shareholders the best." He was quick to point out that his portfolios sold all NASDAQ holdings in early October, "fortunately, very near the highs..." He added, as a consequence, he has no opinion on the stock.

FrankJ also sent some of his great humor:

We came very close to losing BB today, just before the end of the 2nd hour. BB was already under duress from a caller who brought up the notion of gov't taking over people's 401Ks.  

Late in the 2nd hour a caller asked whether the government might decide to tax municipal bonds.

Bob lost it and began shouting repeatedly, with regard to these rumors, "It's coming out of the woodwork!!" 

At this stage Bob went to the break which was fortunate because all it would have taken to drive him off the cliff would have been a caller asserting the need to do away with the Federal Reserve!

Honey here: Regarding Brinker's re-iteration that he sold all Nasdaq holdings in Marketimer in response to Joe's question about Apple Stock:   Brinker said he "had no opinion" on the stock. He must have forgotten that on March 18, 2012, he told the audience that he had owned this stock for over a decade and it was a "magnificent performer."  Here are the excerpts of Brinker's words: 

Bob replied:  ".......You won't hear any complaints about Apple from me because Apple has been extremely good to me over the last decade or so....It's been a magnificent performer. It's a company that I'm invested in, and for the last ten years it's probably been the number one performer over that ten year period that I've owned.  As to when you make a decision to sell Apple? Well, I think that's a decision at some point will have to be made. But I think those who have stayed with it are very, very glad that they have stayed with it....."

It's clear from the paragraph above that Brinker is talking about personal holdings and not Marketimer holdings in QQQ or RYOCX. Brinker has NEVER recommended Apple stock in Marketimer, and has never before said he had invested in Apple on Moneytalk. 

Don't be deceived into thinking otherwise in spite of how it might have sounded. A man of integrity would have made it clear that this was a personal choice that he made for himself but never shared with listeners OR subscribers.

Now today, we have another example of Brinker's lack of integrity in REVERSE when he inferred that his only holdings in Apple were in the Nasdaq holdings in Marketimer.  He may have indeed sold those "decade" old shares of Apple. But if he has, why didn't he just say so? Pathetic lack of character, IMO....

Brinker's guest-speaker was David Wessel: Red Ink: Inside the High-Stakes Politics of the Federal Budget

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