Sunday, July 29, 2018

July 29, 2018, Bob Brinker's Moneytalk: Summary and Commentary

July 29, 2018....Bob Brinker mostly hosted Moneytalk live today.....

STOCK MARKET...Brinker commented that he is still for having 100% of your stock allocations fully invested, and for dollar-cost-averaging new money.   He said that in spite of the auto companies complaints, the stock market had a "reasonable week" with the S&P 500 making fractional gains.

FINANCIAL  MARKETS NOW
OIL: WTI crude oil lost $0.92 to $68.69 per barrel and wholesale gasoline shed $0.01 to $2.11 per gallon.
GOLD: The Bloomberg gold spot price inched $0.72 higher to $1,223.41 per ounce.
DOLLAR: The Dollar Index—a comparison of the U.S. dollar to six major world currencies—was down 0.1% at 94.66.
STOCKS:  The DJIA rose 1.5% (@ 25,451.06);  the S&P 500 Index was 0.6% higher (@ 2818.82);  the Nasdaq Composite declined 1.1% (@ 7737.42).

FACEBOOK HIT THE SKIDS THIS WEEK - not mentioned on Moneytalk today. 

BRINKER SAID 4% GDP COULDN'T BE DONE, BUT THIS IS WHAT HE IS SAYING NOW....Brinker said:  "Well some good economic news.  Okay, it was expected. Okay, we said it would happen. We'll take it. Some good economic news in the second quarter of 2018. Total GDP had a very good second quarter. We talked about a nice bounce off that first quarter. We got that nice bounce.  The first quarter was slightly revised to 2.2% annual growth. But the second quarter was the headline number coming in at 4.1% annual growth.  And that brings the first half annual growth rate up to 3.1%. The advance  estimate for Q2 GDP to one decimal, came in at 4.1% (4.06% to two decimal places), an increase from 2.2% for the Q1 Third Estimate. Investing.com had a consensus of 4.1%."

Honey: LOL! as I typed that. :)

LISTEN TO THE REST OF BRINKER'S ECONOMIC REPORT....==> dRahme's Audio Clip

BONDS, INTEREST RATES...No changes in Brinker's advice to stick to duration of one year or less in bond funds.

ROTH VS REGULAR IRA.... Brinker told a caller today that the only reason he would recommend paying taxes to transfer money from a regular IRA to a Roth IRA is if he was convinced his tax rate would be higher in the future.

HOUSING MARKET....Home prices are at high levels, and likely to stay high because there is a scarcity of available homes. There has been "under building for years," so there is a low inventory.

==> > dRahme Audio Clip: home prices; mortgage rate changes; durable goods gains;

CRYPTO-CURRENCIES - BITCOINS.... Lots of advertising because they are not regulated....extremely volatile....."CAVEAT EMPTOR"

NEXT WEEK IN THE CANYONS OF WALL STREET....dRahme's Audio Clip: pending home sales; PCE Index (watched by FOMC); ADP new jobs estimates. 

FRANKJ'S ORIGINAL SUMMARY OF THIRD-HOUR REPEAT GUEST-AUTHOR AND BOOK FROM  APRIL 2017. No new information was added in today's interview:

Bob’s guest today, April 2, 2017 was William D. Cohan, author of the book “Why Wall Street Matters.”  Today was a repeat appearance for Mr. Cohan on the StarShip.   He is a financial journalist and former banker.   Mr. Cohan said the book is short, easy to read and it is his hope that people will gain a better understanding of Wall Street’s importance to their everyday life.   (Editorial comment in italics as usual.)

A blurb on Amazon books describes this offering as,  “A timely, counterintuitive defense of Wall Street and the big banks as the invisible—albeit flawed—engines that power our ideas, and should be made to work better for all of us.”
Mr. Cohan thinks Wall Street is bashed unfairly by politicians of all stripes and mentioned Bernie Sanders and President Trump in this regard.    He cited an example of Elizabeth Warren blocking the appointment of Antonio Weiss to a government position simply because he once worked on Wall Street.  Mr. Cohan said he knew Mr. Weiss was well-qualified for the job.
The guest believes Wall Street’s compensation model is to blame for financial disasters that result (naturally) in Main Street’s dislike and distrust.   For decades, Wall Street investment firms were partnerships, meaning it was the partners’ capital that was at risk if investments went south.  That changed in the 1970’s when Donaldson, Lufkin and Jenrette was the first firm to go public.  Many more followed suit and the result was that risk was no longer confined to the partners, now it was spread among the shareholders at large.  
He referred to the “bonus culture,” wherein employees of the firm take outsized risks with other people’s money, hoping for that big bonus at the end of the year.  
Bob asked if he blamed Wall Street for 2008?  The guest gave a long answer, beginning with the statement that there was a lot of blame to go around.   Government policy and the actions of Wall Street, mortgage brokers and real estate agents pushed home ownership up from 61% to 70%  (presumably these are percentages of households).   As MoneyTalk regulars well know, there were a lot of people who had no business buying a home during this bubble, but they were accommodated by a greedy lending sector.  
The bottom line was, no one on Wall Street was held responsible.  The Dept. of Justice under President Obama did little or nothing to go after those responsible.  Preet Bharara, former US Attorney in New York City has gone after hedge fund operators but not Wall Streeters involved in the housing debacle.  Mr. Cohan said Bharara told him “stupidity and greed” are not grounds for prosecution and there is a lack of evidence that Wall Street firms acted illegally.  
The guest pointed out that Dan Turillo, a former member of the Fed pushed regulations on Wall Street firms, “trying to turn it into a utility.”   Because they tend to be monopolistic over broad geographical areas, utilities are tightly regulated.  
The result of this regulation is that small and medium sized businesses on Main Street have found it difficult to borrow.   He cited Larry Summers as someone who thinks these regulations are the reason we are stuck at about 2% growth of GDP.   
Keith from Rochester called in.  He’s getting to be a regular on the StarShip.   Normally he is strident and argumentative and makes more of a statement than asks a question.  But today his call fed right into what the guest said about the difficulty of getting capital flowing to Main Street.   Keith cited the hit Rochester took when Kodak folded.   The guest gave a long answer which basically agreed with what Keith said.

Bob wrapped up about 3:55.  

Honey here: Thank you, FrankJ.  I have never before known Brinker to have an author on to discuss the same book he had him on to discuss over a year ago.  And as you pointed out to me, Brinker actually said the book was new. The book is available in paperback on Amazon for $1.30. 

Mr.  Cohan took a cheap shot at President Donald Trump today (something he didn't do a year ago, but that was just three months after inauguration).  Very near the beginning of the interview, Mr. Cohan said that the reason people aren't much interested in the problems on Wall street was because they have a short memory and are focused on what's happening in the White House, where there is "a very strange individual who happens to be our President."

I would like to tell Mr. Cohan  three things: 1. Of course President Trump seems strange to you. He's a genius and you're not. 2. If there was any chance of my buying any of your books, you did away with that with one word "strange." 3.  You slam  most investors with your "short memory" insult, but is your memory long enough to explain why on your prior Moneytalk appearances, you never once had a negative word for Obama. Why is that, hmmm?

Listen Talk Radio:
TALKOFCONNECTICUT;  

85 comments:

slider said...

Brinker just showed he is not the brightest bulb In the box:

1) he missed the opportunity to say the headline GDP number is simply a month over month number annualized which makes no sense, and the last thing we need to do is inflate actual growth of 2.8% YOY to give Powell an excuse to keep tightening rates when it is not warranted. Maybe the Brink is clueless on this matter.

2) The Brink also missed the opportunity to provide a more important advantage the Roth 401k has over the traditional pretax 401k to the caller which a simple example of putting 10k in a performer like AAPL Amzn Msft etc. Which could yield over a million dollars over time and not having to pay any tax on that in a Roth vs. Paying the ordinary income tax on that million+ investment as you are forced to take your RMD.

Honeybee said...

.
Bob Brinker often misses opportunities, but I don't think it's fair to denigrate him for not saying everything about everything to a caller.

Now if you want to talk honesty when it comes to "both of his newsletters" - that's another topic.

He does not have two newsletters. His son has one that he sells by creating the impression it is his father's.

frankj said...

2:45 PM, three quarters of the way through the 2nd hour and the show starts over from the beginning when coming back from a break.

Stinky said...

HB, there was a post that came in to last weeks thread either last night or this morning. You deleted it from the thread, but I saw it. It was blasting Fox News as the real “fake news” and basically said that those that watch Fox are ignorant idiots who are being lied to daily.

If the person who posted that is watching this thread, I have a response for him/her. Yes, I do watch Fox News, and I sure hope that I’m not ignorant or an idiot.

The reason to watch Fox is to avoid the incessant Trump bashing that goes on almost anywhere else. For example - Others in my house tuned into Today Show on NBC this morning. They called on Chuck Todd to give a week in review. He was all full of the Michael Cohen garbage and that tariffs would hurt the Trump base. But nothing about good economic news, progress on trade with EU, North Korea missle sites, etc.

I’m just so tired of the trump bashing almost everywhere except Fox News.

Honeybee said...

.
Stinky.... You are right about that post that I deleted. He later sent me a comment bragging about getting it on the blog so I deleted the damn thing.


But if you want to respond, I will drag a copy of the stinking thing out of my trash bin and post it here for you to respond to.

Honeybee said...

.
Stinky...Sorry, I must have been really ticked off about that post because I pushed the "forever outta here" button.

But you are right about the subject. Feel free to respond however you would have if I hadn't deleted it. It will do my heart good. :)

tfb said...

My interpretation only:

I only listened for about 5 minutes, but what a 5 minutes it was. I wonder if anyone else caught on that Da Brink more or less admitted to something I have said for years, and that is he no longer has a model at all. He gave up on trying to build a model after he missed the QQQ counter trend and after he blew the buy signals after the 2008 debacle. In misses in the past he use to go on and on about how he adjusted his model, etc, etc but after the last couple of misses it appears to my ears that he though the towel in.

Essentially he said you have to look at the market in its totality. Years ago he use to wax on and attempted to paint the picture that he had a secret squirrel quant model that also linked to his own qualitative macroeconomic forecast.
To me, the emperor has had no clothes since the late 80s…but it is interesting seeing him now have the hubris to expose himself.

tfb

tfb said...

"The reason to watch Fox is” for the totally hot female correspondents, anchors, and reporters they have. Conservative women, like the Hottiebee just get hotter and as time progresses. Take a look at the likes of the Fox line-up Catherine Herridge, attractive, confident, intelligent a total package. Laura Ingraham …grrrr…Martha MacCallum, Grethcen Carlson, Dana Perino, Lea Gabrielle all real women, as they use to say “one to rid eth river with”.
Even Fox’s resident self-professed lesbian (Tammy Bruce) is far hotter than that nasty dyke Rachel Maddow. The is something so appealing about an intelligent woman, that just captures a man’s interest.

Stinky said...

HB, no need for me to post anything else about Fox News. They live up to their motto of “Fair and Balanced”.

NBC, CBS, ABC, CNN (gag), MSNBC (double gag), and PBS are not “balanced”. All anti-Trump, all the time.

gabe said...

With all of the positive stats that Bob presented about the week past, I am wondering why the Market did not do much better than it did. Perhaps.......Faceboodk.

Gabe

burt said...

"Stinky" you mention Chuck Todd "If it's Sunday you better believe I am expressing my bias against Trump", then there is little Richard Engel who said the war in Syria would be over, 5 years ago. Engel was nearly crying on the night Trump won. He also wears military vests to look tough in safe areas. Then there was the time he was captured in Syria, looked like he was going to pee in his pants.

Gooch, Teaneck NJ said...

Now it's a certainty! The radio host is a snake oil salesman.

He uses all the tactics, such as claiming a prediction he didn't make, reciting history as if he predicted it would happen, grandstanding about past pure luck as if possessing a predictive talent, and always shouting down and shaming anyone who challenges the claims.

There is no f-ing way he "said would happen" a 4% growth rate for Q2. He's a blatant huckster, no offense to all the sneaky hucksters from Philly.

Beyond the pale, where does it end?

Anonymous said...

tfb - Gretchen Carlson left Fox News in June 2016, filed a lawsuit against the network for sexual discrimination, and soon settled for $20 million.

Note: A cold shower could do wonders for you (!)

Stinky said...

HB, one more question. Your summary said that Brinker recommended converting regular IRA to Roth IRA only if you expect tax rates to be lower in the future.

Isn’t that backwards? Wouldn’t you convert if you expect future tax rates to be higher?

tfb said...

ROTH VS REGULAR IRA.... Brinker told a caller today that the only reason he would recommend paying taxes to transfer money from a regular IRA to a Roth IRA is if he was convinced his tax rate would be lower in the future.

???? Is the last sentence suppose to read:

if he was convinced his tax rate would be higher in the future.

tfb

Unknown said...

Say it with me slowly Bob.."4.1% GDP growth, on our way to a 3%+ expansion over 2018. Additionally, Federal revenue will increase despite the tax cut". Maybe Bob will eventually realize freedom works everytime.

Unknown said...

Say it with me slowly Bob.."4.1% GDP growth, on our way to a 3%+ expansion over 2018. Additionally, Federal revenue will increase despite the tax cut". Maybe Bob will eventually realize freedom works everytime.

Honeybee said...

.
Thank you, TFB! That's called a formerly-blonde senior moment. :)

I'll correct it.

Honeybee said...

.
Stinky....Yes, thanks for the correction.

I count on "yous guys" to find my boo-boos and let me know about them. :)

Bluce said...

Regarding Fox's foxes: To me, Martha McCallum is the most beautiful woman I've ever seen. Photos don't do her justice; video captures ALL of the beauty.

HONEY: I was socializing all day and missed Binky, so thanks for the write-up! I will listen to dRahme's audio tomorrow.

Anonymous said...

Honey Bee - Just want to say that it's a nice service you provide with this site. It's much appreciated.

BTW: I'm often tied up when Brinker's show is live. But it airs on KNPT in Newport, OR, each Sunday from 9 p.m. to midnight (Central time). You can find it via tunein. I've gone to the KNPT website but never found a link to a live stream.

Thanks.

J Wales said...

When you think about it its impossible to have a timing model for something as complex as the stock market. When long term capital management collapsed in the late 1990s & was bailed out by the fed it became very obvious that that game is pure fantasy. Those people had huge resources compared to a guy like Bob. The whole thing is a con on peoples greed & ego. Thinking you'll be smarter than everyone else. We all want to believe in the wizard of oz. Pay no attention to that man behind the curtain.

Bluce said...

Swedrow on Investors Defy Evidence.

Trees said...

Due BB Trump bashing I've preferred to read your summary. Thank you for that.

Last week a poll with results of citizens becoming tired and turning off media, because of the incessant bashing and negativity. The Left typical MO is to hype and act up. I listened to a caller complain "that of course we go extreme. It's to bring the Right back to center". IOW's they go way Left in hope to shift the center per compromise.

Brinker keeps his radio show in old age because he like the work, money, and prestige gained with his friends all of the same political persuasion. The guy has remarkable communication abilities. He does sound calm and assure. He throws out stats like he is the experts expert and you listeners need to belt up for a star ship ride to land of critical mass. He talks down to the inferior class and those not using correct thinking skills. Meaning if the caller has a truly hard question or if where in the host would be embarrassed. He'll take the usual affluent calls with the usual thankfulness.

This is salesmanship 101. He lives on his image of up to date financial titan that schmoozes with all the important people. He has to express irritation with those callers that just subpar and take away the time we have to gain his golden advice. Snobbery is his credial to prove wealth. I've seen this tactic so many times. It works for a lot of people that chose to identify with the club and be snooty in the future too. The biggest threat to the man is a independent analysis of his actual information. Something the call screener can't protect his image from. Something BB can distort or talk his way out of. Listen to BB and wonder why isn't he the Fed Chair or running the country?

BB simplified advice of 1 year max for bonds is just poor. In general true, but for investment purposes it aint that easy. Neither is his advice of stock bond ratio. It's such a generalization, that the value is about zero.

As you know concern on Iran. But with their economy tanking, they have many other problems. It's probably a good time to cuff them. Trade war concerns are hyped up per midterms. I reading investors better buckle up as the rehortoric will go to more senseless drama. So, since investors are of the more intelligent class. They see this Executive as a cut above anything they have seen before. His record of accomplishments impressive on every front. So, the wild card threat really comes down to if the swamp can destroy him before midterms. That's what I'm watching and why still holding cash. The markets are a bit dicey in my opinion due to the craziness of politics that truly have an ugly uncovering of the swamp business. It's quite the drama playing out. It is expected to get worse. Half the country would love to put our future in harms way for the greater good.

slider said...

The roth answer brink gave still bothers me because his was a simplistic one size fits all approach to a multiple faceted outcome possibility without recognizing this fact.

Brink would have done better if he had simply said his answer is but one thing to consider, instead he made it seem like his answer was the only thing to consider.

Maybe that caller will luck out and wind up here and read this to realize there is more to consider on the Roth decision than whether your taxes in retirement will be lower or higher than now.

The market action of late seems to be sniffing out that the GDP growth is closer to 2.8% yoy than the headline 2nd q 4.1%. If I'm not mistaken I think the 2.8% yoy is in line with Fed estimates of 2,8% for 2018 and slowing to 2.4% in 2019. I maintain Bob blew it here also, conceivably out of ignorance for what a quarterly annualized number represents. When Santelli reported the gdp number friday he had the good sense to at least present a 4 qtr. Average. Bob was oblivious.

Irwin in Skokie said...

Cohan mentioned the failure to prosecute "responsible" Wall Street execs for the 2008 meltdown. Neat inside stuff talking about the "dinner" at the restaurant with Geitner and Bernanke.

frankj said...

Irwin: I heard that comment too, by Cohan. He very neatly slipped that in.

Geithner who did his taxes on-line and didn't realize he needed to report what he paid a nanny -- wasn't that it? I'm just one of the Great Unwashed but I learned right out of the box that the non-profit that I'm with (as Treasurer) needs to report the 1099-MISC wages paid to our one employee using the 1095 and 1096 forms. It takes very little time.

In Geithner's situation a nanny would have been an employee so the IRS is looking for the payroll taxes to have been paid.



tfb said...

The roth answer brink gave still bothers me because his was a simplistic one size fits all approach to a multiple faceted outcome possibility without recognizing this fact.

I totally agree. And this is where I disagree with those who often state Brinker is a great educator etc. I think he is generally irresponsible. I do like that he owns up that he does not advise on taxes and suggest a CPA. I wish he was that upfront about the fact he clearly is not a financial planner or investment adviser.

Anonymous said...

Zoe said

I believe BB meant to say, he didn't expect to see 4.1% but he'll take it anyway.

gabe said...

The Market acted poorly today. Hopefully, tomorrow will be better!

Gabe

Honeybee said...

.
Zoe...I'm sure you can read, since you can write.

I'm sure that BB meant to say what he ACTUALLY DID SAY:

"Okay, it was expected. Okay, we said it would happen. We'll take it. Some good economic news in the second quarter of 2018. Total GDP had a very good second quarter. We talked about a nice bounce off that first quarter. We got that nice bounce."

Gawd said...

So, did Bob Brinker say there would be some good economic news in the second quarter of 2018 that would score a nice bounce off that first quarter or not? I mean, had he been saying nothing like that or, worse, that such an outcome as that "nice bounce" coming in at a quarterly percentage increase greater than 3% would not happen?

I don't see why he would have seen such a figure as impossible, unlikely or unexpected. The market certainly didn't. After all, we've seen several quarterly GDP growth results higher than 4% over the past few years without Bob Brinker doing cartwheels about it.

Trees said...

The GNP stats provided by BEA are a treasure trove to benchmark the country's financial health. This info just to important to simply take a few minutes or a quick news flash. When Kudlow was on the air, he did an excellent job of hosting those experts with different opinions and hashing out the fine points of reports like these. It really does take someone that has long memory and works with economic figures daily to vet. A respected economist with good charting and explanations. Adding up the various reports on regional differences, inflation, jobs report, stock growth, P/Es, and sector performance and most importantly to put it all within the hands of experience analysis.

We read these titans of finance take on the economy only to get conflicting advice. Between those with political bias and those attempting to gain clicks with provocative analysis what do we independent investor think? Everyone has an opinion and all are guessing of the future. Doesn't it seem like most professionals are hiding true value analysis or exploiting the data for self benefit. Meaning to exploit us. I'm thinking Bogle advice is the safest and most valuable. So many sharks out their and better to simplify and forget. Funny, a simple way with less risk or a complicated high risk way to invest. Sad, but many entry level investors get burned with either attempting to beat the market or by taking advice. This class of bad investor then gives up. Claims the stock market is rigged and now on will only trust bank savings.

birdbrain said...

I have informally advised more than a few folks over the years about investing and an saddened with the lack of basic mathematic knowledge that has been heard.

Investors may hear on the news "the Dow fell 100 points." Is this bad? Terrible? No big deal? As I say, you need to look at the percentage change. Had the Dow been at 1000, that would represent a ten percent decline, a financial earthquake for a market index. With the Dow currently over 25000 it would take a 250 point drop to represent only a one percent slip.

Unless you trade equities (as I did in a former life), and have a long term term outlook with your retirement account, look at market moves on a weekly or quarterly basis. Forget the day to day gyrations. More often than not after five days of wild swings the index you follow will be close to where it started.

Thank you for attending. Class dismissed.

frankj said...

birdbrain: To your point -- the local radio station I listen to reports the day's market activity in terms of the Dow, 30 stocks ... Better to report the SP 500. And they report in terms of "points," not percentages which are more meaningful, like you said.

And regarding percentages: the high school teacher who does the personal finance course told me one year early on, he had to review "percentages" because too many students had no clue. And these are 11th and 12th graders!

Jerrod Clarkson said...

frankj said...
And regarding percentages: the high school teacher who does the personal finance course told me one year early on, he had to review "percentages" because too many students had no clue. And these are 11th and 12th graders!

frankj

That is astonishingly depressing.

Hopefully once he gets some learnin' into those student's noggins the teacher didn't grade them on a curve!

Why Grading on the Curve Hurts

https://goo.gl/Uu3QkR

JC

Bluce said...

As I've noted before, the majority of newsreaders have no clue what an index is, much less what a "point" is vs. a percent.

I'm assuming the investment porn newsreaders probably know what an index is, but I've never watched them and have no plans to.

MK said...

Don Luskin, Chief Investment Officer at Trend Macro wrote an op-ed in the July 27, 2018 Wall Street Journal titled "China Is Losing the Trade War With Trump". He was interviewed on Breitbart Radio tonight. You can find an article about it with a recording at:

https://www.breitbart.com/radio/2018/07/31/exclusive-don-luskin-trump-will-win-the-trade-war-because-china-is-a-fragile-lawless-slave-state/

Maybe it's my confirmation bias but it gives me encouragement that I have been correct about enduring a little pain for long term gain when it comes to dealing with a country that has been using us as their patsy for way too long.

Honeybee said...

.
This morning's ADP report as presented by Charles Payne:

Charles V Payne @cvpayne
3 hours ago

Breaking News

ADP Reports 219,000 Jobs in July
Consensus 185,000

Solid throughout but highlight is dirty fingernail jobs especially manufacturing. Last 19 months has seen 836,000 new manufacturing jobs vs. prior 19 months only 26,000 - no wonder they said it couldn't be done!

slider said...

The ADP report is never a reliable source of employment info as far back as I can remember. Average of 44k manu Jobs per month is laughable.

The stats quoted are at odds with the employment report which says 285,000 manufacturing jobs added over the past year or average of 23.75k per month

gabe said...

AAPL close to a Trillion! What a great consumer stock along with AMZN and MSFT.


Gabe

tfb said...

MK writes:

Maybe it's my confirmation bias but it gives me encouragement that I have been correct about enduring a little pain for long term gain when it comes to dealing with a country that has been using us as their patsy for way too long.

I am glad you can also see it. It interests me that the farmers seem down for the fight.

I spoke at an Agriculture convention last week and I was pleasantly surprised by the rally cry coming from the growers. A common sentiment was, if the government would keep them in the game they were willing to sacrifice a few years of profits for the good of the country. What they were looking for is not losing their farms, at least at this convention, last week; who knows how fast sentiments change.

There once was a time in this country's history when corporations, like IBM, use to be patriotic (e.g. the great depression). Now they are turncoats, particularly IBM. So I guess it is up to our farmers and we the consumers to carry the battle flag in sport of our great President and his America first agenda.

Okay, soapbox mode off.

tfb

tfb said...

AAPL close to a Trillion! What a great consumer stock along with AMZN and MSFT.

Cracks me up. I don't own an Apple product, I have never shopped on Amazon and recommend to my clients against their cloud service, and I despise Microsoft as I am an old CPM, OS2, and Linux bigot.

That side, I know most sheeple use their products.

tfb said...

Just thought I would mention FIDO just launched two zero expense ration funds....yep you got hat right, zero ERs. One of the total stock market the other for international. No minimum wither. For retail accounts only. They also dramatically slashed their ERs on other funds. As a FIDO bigot(I have repeated bad experiences whit Vanguard) I applaud their leadership.

I am concerned about the tax efficiency as I currently hold a lot of ITOT in taxable for that reason. But certainly in the tax sheltered arena this looks good and it may also be good for taxable.

It appears FIDO intends to make money off of security lending and also they are creating their own indexes so they do not have to pay a fee.

reference:

https://www.cnbc.com/2018/08/01/fidelity-one-ups-vanguard-first-company-to-offer-no-fee-index-fund.html

tfb

Jerrod Clarkson said...

tfb,

I am a Fidelity customer. I logged in hoping I could find out more about:

FZROX US Total Stock Market Fund and the
FZILX International fund.

Both funds are due to launch tomorrow, 8/3/18.

I was hoping to at least get a sense of major holdings, etc. Couldn't find anything of substance. Strange!

Perhaps they need to embargo all financial info until the day the funds open? Maybe a SEC rule?

JC

J Wales said...

JC wouldn't a cap weighted total market index funds look like clones of each other?

gabe said...

AAPL reached a trillion! What a Stock.

Gabe

tfb said...

JC,

You can just ask FIDO, they will tell you.

Based on your postings you are likely are FIDO private client so they will go out of the way to fill you in.

My understanding is their total stock market looks a lot like the Russel 3000.

Cheers,

tfb

tfb said...

I have been reading the Bogleheads forum of late....good gosh there are a lot of of Vanguard sycophants. It is down right creepy. They remind me of the Brinker sycophants, they are totally deluded in their devotion. A lot of people appear to try and stand their ground and their posts are edited or the thread disappear.

A lot of good advice is disseminated in that forum, but the Vanguard worship is way over the top, especially given the reality that is Vanguard. I can understand John Bogle worship, but Vanguard, not so much.

tfb

rjb112 said...

tfb said.....

"I am concerned about the tax efficiency as I currently hold a lot of ITOT in taxable for that reason. But certainly in the tax sheltered arena this looks good and it may also be good for taxable."
++++++++++++++++++++++

tfb, why are you concerned about the tax efficiency of these two zero expense ratio index funds?

Have Fidelity's prior total stock market index funds made taxable capital gains distributions?

Of course we have to expect dividend distributions, but have the Fidelity and Schwab total stock market index funds had capital gains distributions that you are worried about?

Or did the Vanguard total stock market index funds make capital gains distributions in the years prior to them having any ETFs associated with their index funds?

thanks

Robert

gabe said...

Will FAANG carry the day for the Market?

Gabe

J Wales said...

A trillion ain't what it used to be:)

Honeybee said...

.
Jobs report this morning :

* Total nonfarm payrolls increased by 157,000 for the month, below the 190,000 expected in a survey of Reuters economists and the lowest gain since March.

* The unemployment rate fell one-tenth of a percentage point to 3.9 percent, as expected.

* Average hourly earnings increased 2.7 percent over the same period a year ago.

* For June 2018 the official Current U-6 unemployment rate was 8.1% up sharply from the low of 7.3% in May and 7.4% in April and back in the range of 8.1% in March, 8.6% in February, 8.0% in December 2017.

U-6 Unemployment was 10.1% in January 2017 wit a long term peak at 17.9% in February 2010.

tfb said...

tfb, why are you concerned about the tax efficiency of these two zero expense ratio index funds?

Have Fidelity's prior total stock market index funds made taxable capital gains distributions?

Of course we have to expect dividend distributions, but have the Fidelity and Schwab total stock market index funds had capital gains distributions that you are worried about?

Or did the Vanguard total stock market index funds make capital gains distributions in the years prior to them having any ETFs associated with their index funds?


2/3 of my investment portfolio is taxable. I have been hit with unrealized (from my standpoint) capital gains from both index and non-index mutual funds in the past. Vanguard has an advantage here, as they have a patented system (does not run out until 2021 as I recall, and that ends the only positive thing I can say about Vanguard). The dividend distributions are bad enough, but during a market downturn like in 2008-2009 you can get zapped with capital gain distributions on top of it.

I have tried to mitigate that by using etfs like ITOT. But even then a .03% ER is nothing to sneeze at.

At times Berkshire looks awfully tempting.

tfb said...

U6 may be a lousy measure for the Trump economy. What I have anecdotally heard is a lot of downsized and outsourced people who gave up under the Bush-Clinton-Bush-Obama reign of economic terror on the middle class have recently started inquiring about jobs. In other words you have folks who have not looked for work in one or more decades suddenly expressing interest again and therefore are likely to get counted again.

I know a couple of clients of mine mentioned they suddenly have people who have not worked in 10-20 years applying for entry level positions. It is interesting as they are looking at these older, clean cut workers, with interest, when contrasted with the tattooed, multi-hair-colored, multi-pierced freaks applying for the same jobs.

Honeybee said...

.
Five good weeks. From Fox Business:

The Dow Jones Industrial Average rallied 136.42 points, or 0.54%, to 25,462.58. The S&P 500 climbed 13.13 points, about 0.4%, to 2,840.35. The Nasdaq Composite was up 9.33 points, or 0.12%, at 7,812.02.

The blue-chip Dow and the S&P closed the week in positive territory, extending their winning streaks to five weeks.

Bluce said...

Bunny wrote: It is interesting as they are looking at these older, clean cut workers, with interest, when contrasted with the tattooed, multi-hair-colored, multi-pierced freaks applying for the same jobs.

Funny you mentioned this now. Last night I went to the local watering hole for tacos and beer, and they had a new barmaid. She was barely old enough to drink, and VERY unsure of herself, nervous, jerky, shy, could barely find her tongue -- the whole shebang. I had to ask HER if I could have a beer.

I mentioned to the guy next to me that she looks like she's afraid of her own shadow, and bartending seemed like an odd job for her to have. He heartily agreed. This is the type of bar where us blue-collar/calloused hands/hotrodders/construction types hang out. A good bunch of solid country boys, with maybe a few rough edges.

Then I said again, to the guy next to me: "But it looks like she wasn't afraid of the tattoo needle." She was plastered with them -- arms, neck, hands. And a very nice looking young lady too, minus the ink. I don't get it.

I hope she ends up liking bartending, because with all that permanent ink she certainly limited her chances of doing something better.

Bluce said...

Too lazy to Google it, but has the S&P hit an all-time high?

My bond-heavy portfolio has.

tfb said...

Bluce, it is just plain sad. A lot of women have long body tattoos that could only be viewed if they totally disrobed. Ergo they just look stupid when they are out in public with a nondescript piece of ink showing.

What is really odd are the piercings. When I look at some of it, I think back to Nam and how the gooks use to do that type of crap to our boys as torture and here these freaks volunteer for it. What the kittens...

gabe said...

I personally do not like tattoos on woman.

Gabe

Bluce said...

tfb: Yeah I don't get the piercings. Who wants bits of metal all over their face?

And the ones that go through the side of the nostril: What do they do in the morning when they blow their nose? Do they take it out first? Or do they wait til it's loaded up with snot after several days before they remove it?

I'm basically lazy, and the less I have to do the better. I cut all my hair off in 1997, threw out all my combs, brushes, shampoo, and hair dryer. Since then my head maintenance consists of brushing my teeth and running a washcloth over my head -- and I've never looked back.

Trees said...

Vanguard has more funds that I'm interested in. The lower Admiral cost funds only available within Vanguard. Next would be the Blackrock Ishares funds. I was in Fidelity, but they were to sales/marketing orientated. Interesting that Fidelity is making 4x the revenue compared to Vanguard and I think Vanguard has more investor money. All I know is that there is so many ways for these financial houses to exploit investors. A recent article on Swab amazing revenue from zero cost trades. A marketing phenom and they have a new costing tactic. Vanguard is investor owned. They are mandated to work in our best interests.

Paul said...

Woman is art. Tattoos on women is akin to graffiti covering fine-art.
Paul NYSL (not your son-in-law)

gabe said...

I am a Vanguard Investor and so is my son. He advises that Vanguard Flagship Select only charges .20% to provide Portfolio Management. He is very satisfied with their philosophy and management style and all of the services it offers in this Program. "It takes all of the guess work out of the investment equation" is his quote to me. So....I said good for you.

Gabe

Mad as HELL ! said...

Bluce said:
"I hope she ends up liking bartending, because with all that permanent ink she certainly limited her chances of doing something better."

Bluce,

I frequently see potentially very beautiful young ladies who (IMO) have desecrated and mutilated their body with piercings, tattoos, etc.

Hey, I'm OK with one or even a couple of small, cute, discreet tattoos, but I really don't care for the tribal and/or circus carnival look. I wonder if they give any thought to how their tats are going to look as Mother Time begins to do naughty things to their body, skin, etc. as the years tick away.

tfb said...

I wonder if they give any thought to how their tats are going to look as Mother Time begins to do naughty things to their body, skin, etc. as the years tick away.

I swim almost every day, so I see a lot of aging tattoo art at the pool. Here is my general observation: the type of women that get this so alleged body art, generally end up with that very hard look women get who live a rather fast paced life filled with poor choices. By the time they are in their mid 30s they tend to beyond caring what they look like or what anyone thinks, much less being a role model for any children they have in tow, i.e. profanity laced parenting etc. There are exceptions, I know are a few, but they tend to be far and few between.

The lower back design are called tramp stamps for good reason. It seems tattoo art is type of self selection. Just like I have yet to meet a negro with his pants hanging down to his knees, his underwear showing, spewing profanity who possesses a MBA or is a CPA I have yet to meet a body art queen who's lifestyle ends up worthy of emulation. My observations only. Your mileage may vary.

tfb said...

Woman is art. Tattoos on women is akin to graffiti covering fine-art.

:) What an awesome post.

tfb

Bluce said...

MAD, tfb, et al.:

We were discussing this very thing at the diner today after some 2nd (3rd?) generation hippy walked by the window. My neighbor, who is 90, said he would not let some kooky-looking guy like that in his house. His wife called him "a bigot," lol. But she's a radical feminist so it all fits in some perverted way.

Thinking of the painted-up barmaid, I brought up tattoos. I said that if I found myself in front of a "professional" -- doctor, lawyer, any salesman -- with tattoos all over I would not do business with them. My neighbor's 86 year-old wife did NOT call me a bigot, heh. She was probably just being nice, but I bet she was biting her tongue.

frankj said...

We interrupt this discussion of tattoos to bring you this news item:

https://www.amazon.com/gp/product/1119366550/ref=dbs_a_def_rwt_hsch_vapi_taft_p1_i0

Ok, that's the link to a book on Amazon called Big Mistakes: The Best Investors and Their Worst Investments. Published June 2018. Author Michael Batnick.

Bob Brinker if you're lurking here, this author might make a good guest. Certainly no worse than those who are beating on what happened in the meltdown in 2008.

We now resume our discussion of tattoos. I saw a middle aged woman at the library with tattoos on both arms, both legs, feet, ankles and .... FOREHEAD.

Bluce said...

I wonder if Honey has any tatts?

Honeybee said...

.
Bluce….LOL! Nope, not in a million years!

The only "damage" I was willing to do to my body was piercing my ears.

Bluce said...

LOL, good to hear, Honey!

Jim said...

I might as well give my 2 cents on tattoos. There's almost nothing that makes a woman more unattractive than tattoos. I'm not married but if I was the wife wouldn't have a tattoo. Body piercings are equally bad. People have their bodies pierced in their private areas. Simply unbelievable!

SuziPie said...

'Barack Obama Day' Is Now an Illinois Holiday

https://www.usatoday.com/story/news/politics/2018/08/04/barack-obama-birthday-becomes-illinois-holiday-starting-saturday/900905002/

"The legislature in Obama's former home state of Illinois passed a law last year to designate each Aug. 4 as a commemorative holiday to celebrate the 44th president, whose political career began in the Land of Lincoln. The law, signed by Republican Gov. Bruce Rauner, takes effect this year."

Seems like he could have shared "President's Day" with all the rest?

You crazy Illini have a nice Barack Obama Day!

SuziPie

Anonymous said...

Barack Hussein Obama day????????
As an Illinoisan, what could be more fitting as we circle the financial drain?
Woo-Hoo!!

Pavlov’s Cat

tfb said...

It was thus quipped:

I wonder if Honey has any tatts?

I promise to be good, I promise to be good...

tfb said...

Barack Obama is a fitting holiday for the corrupt state of Illinois. He clearly is the most corrupt President in this nations history by wide sweeping margins. It is only fitting Illinois tips its hat to its non-native son. Something to be proud of there.

frankj said...

tfb, should I be watering my apple tree. Apples on it are a bit larger than ping pong balls now. We've had an extended dry spell. Inquiring minds want to know. Thanks.

frankj said...

Obama Day: Do state workers get a paid day off?

frankj said...

I didn't read the article first. It says it is commemorative only. No paid day off for state workers.

tfb said...

FrankJ,

I depends on your climatic zone and the rootstock of the apple tree and if you train it to a tree form or a espalier.

M27 or P22 or Mark you definitely need to water. Bud 9 or any M9 clones you may need to. M26, unless you are in a major drought it is unlikely. M7 to M111 very unlikely. On seedling or Nortern Spy no way, but those would be huge trees.

You may want to thin your apples to get them to size up. 6 inches apart is a good spacing. Also, as an FYI, the less water the apples get, in general the more flavorful they likely will be, albeit smaller in size. also the variety matters, some split if they get water around ripening time. Dayton is notorious for it, as an example.

Mad as HELL ! said...

frankj said...
"I didn't read the article first. It says it is commemorative only. No paid day off for state workers."


It really doesn't make any difference. Every day a state "worker" reports for "work" is effectively a paid day off.

gabe said...

Have you seen State/County road workers repairing pot holes on our streets whereby they may have 3 workers standing and looking at one of their workers doing the work. Taxpayer money down the drain. I guess it is "make work" so that folks have a job!

Gabe

tfb said...

Gabe,

In states like IL the standing guy has the most important job of all. He is there because of massive workman's comps lawsuits. Essentially he is in charge of safety. Without his presence the negligent liability claims go way, way up.

By the way, I think it is ridiculous and a waste of money in the normal sense, but it is that way as a result of ridiculous settlements. And of course the have a guy watch solution was proposed by the corrupt unions who are the ones that get the judges and arbitrators electd and appointed over the workman's comp lawsuits.

tfb

Stinky said...

Thanks for all of the supportive comments about what going on over at M*.

I've just answered Gary1952's most recent misleading post. Wonder what fantasy he'll dream up for his next response.