STOCK MARKET...BB comments: Dollar-cost-average new money now.....greatest run in market of all time, and it is now at all-time-highs. Those in retirement should keep a balanced asset allocation.
==> Thanks to dRahme, clip of Brinker's stock market and Fed comments.
WHAT IF THERE IS A MAJOR MARKET CORRECTION.... Caller Bill from New York - age 80 - asked if he should liquidate all of his stock and bond investments because he is afraid that there will be a major correction.
Brinker replied: "If you have the proper asset allocation and you have a constructive view on the market, then you're where I'd like to be. If you do not have a proper asset allocation, then you should get it certainly in line with a proper allocation would be for you. And someone in your age group, I would be 50%, or maybe even less equities and more fixed income - maybe 40-60 - maybe even 30-70 at your age. But as far as the market is concerned, if I have that view that the market is in trouble, I of course express that in Marketimer.....This is Moneytalk.BROKERAGE HOUSE SIPC INSURANCE..... SIPC insurance covers $500,000 in case of a brokerage house failure.
Brinker commented that if you stick with the big companies (like Schwab, Vanguard or Fidelity), there is no reason to be concerned about failure, but he is still pro-SIPC insurance.ECONOMY.... BB: Q3 growth rate figures are soft...August numbers declined -0.2%....minus automobiles and gasoline, it's -0.1%. This may be partly attributable to Hurricane Harvey in Texas and Hurricane Irma in Florida.
==> Thanks to dRahme: Clip of economy and hurricane's effect and what's ahead.
FOMC/INTEREST RATES.... BB: Will not see an increase in Federal Funds rate at the meeting next week.....Expect rates to remain the same....Depending on what happens to economy, the next possible rate increase is the December meeting.
INFLATION...BB: Inflation is below 2%, which is below FOMC target.
BITCOIN = TULIPMANIA....Caller Burton pointed out that Jamie Dimon said that Bitcoin is "destined to fail" and is a "con game." Brinker agreed, and said it was like "Tulipmania."
BRINKER'S MARKETIMER INCOME PORTFOLIO....BB: Caller Mike in Glen Dora asked about yield. Brinker commented that the yield was now at 2.9% - as per page 7 of his investment letter.
Honey EC: Brinker touts using low-duration bond funds. The three funds (DLSNX; MWCRX; OSTIX) in Marketimer are about 1.5 year duration. But be aware that at least two of those funds contain very high yield (junk) bonds.
BOND FUNDS IN MARKETIMER.....BB: If moving from stock to bonds and using the 3 funds in the Marketimer income portfolio, no need to dollar-cost-average - just make the move.
MULTI-MILLIONAIRE CALLER WITH HUGE PROBLEMS.... Caller John, with $2 million net worth needed Brinker's help choosing whether to take an $84,000 yearly pension or a lump sum of $1.5 million.
Brinker said that since John has four kids and 6 grandkids, he might want to add the lump sump to his net worth so he'd have more to leave to them.==> Thanks to dRahme, clip of next week in the Canyons of Wall Street
FRANKJ'S MONEYTALK GUEST-AUTHOR SUMMARY
After a two week time out Bob was back on September 17, 2017 with John Pugliano author of The Robots Are Coming as his third hour guest. Bob sure likes these “futurists.”
Bob asked if someone has a job that a robot could take over, is that job worth aspiring to?
The guest answered, that no, the job is not worth having. But he quickly pointed out that it isn’t just the hamburger flipper jobs that are at risk: auto mechanics, doctors, attorneys and mid-level managers could be hit.
The knowledge gained through years of study, whether it is fixing cars or diagnosing illnesses can be loaded into databases and put in “the cloud.” He mentioned the computer diagnosis to sort out a check engine light signal. The implication was it won’t take a mechanic to do that. He also hypothesized that smart phones may someday have an app that allows you to lick the screen or something similar and an app will figure out whether you have a garden variety sore throat or a strep throat.
We shall see.
As far as college study goes, the guest recommended the classics. But he was not referring to art, literature and philosophy. He meant science and math.
The people most at risk are those in their late 40’s who are entering their high earning years. He says they better look into starting a business and be willing to move. The specific expert knowledge they’ll need to run a business will be available on the web. Bob pointed out that not everyone can start their own business and/or is willing to move.
As if on cue, Bob went to a caller, Tino from Connecticut, who said half the people out there have IQs below average. (Reminds me of Larry the Cable Guy pointing out that “half the people you meet are below average.”) The guest’s response was that “tech will help them.” Bob pointed out that what the guest just said was that native intelligence will be less important than it has been in the past.
Karen from Albuquerque wanted to know if robots will pay into Social Security. Somebody pointed out that Bill Gates wants to tax robots. This led the guest to say he wasn’t worried because “the FED will print enough money.” Bob jumped in quickly to correct him, saying that’s not in the current budget.
Rick from western Pennsylvania has two sons who are out of college working in the computer science and computer engineering fields. Not to worry said the guest their jobs are probably OK and cyber security is an area they might look at. (Yeah, Equifax might be hiring.)
Then Paul from Buffalo called, but my phone rang and I had to take the call so I missed his question and the answer.
At the end of the interview Bob went back to the topic of the guaranteed basic income and said the reality is, in a country with 29 million people not covered by healthcare the guaranteed basic income is not going to happen.
Ed. comment: I thought Obamacare fixed all that. (?) I think it would have made more sense to say:
1) In a country that is $20 trillion in debt, the guaranteed basic income is not going to happen.
2) In a country where Social Security and Medicare are two of the biggest entitlement programs and they’re both headed for insolvency … the guaranteed basic income is not going to happen.
3) In a country where the two major parties can barely agree on what day of the week it is … the guaranteed basic income is not going to happen.
Earth to Bob: Enough with the futurists already. How about a nice long break until the next one? Say one year.
Honey here: Thanks so much for that great summary of a rather boring guest. I think Brinker might want to have you as a guest - spice up that third hour. :)
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