Recently in Money Category

So as the world bids adieu to the first tenth of the twenty-first century, the passage of time brought good and bad.  Rather than doing a list, I'd like to concentrate on a very narrow section of one major topic, the economy.

All I want to say here is how important it is to remember the charities you believe in.  Donating money, time, or product to a good cause should be about causes you care about.  Everyone has been affected by the economy, so I made an effort this year to spread the wealth, which I have none of.  But what I have, I make sure it goes around.  In particular, I will admit that I donate a large percentage of my donations to one particular group of organizations, those who help fight cancer.  But that is what I care about, so that is where my money will go.  So with that, here is the list of organizations I donated to in 2009.

I'm sure there are others I've missed, as I've dropped off loose change or cash to the buckets, boots, and boxes all across the region. For many of you, the donation could mean a tax deduction.  But for everyone, just remember to donate to causes you care about.

Happy New Year to All and let's hope for a better 2010 for everyone.
I don't like to brag.  Wait, I do, but I don't have a lot to brag about right now.  Back to the subject.  Since I was 18, I've had money in the market.  No, I'm not Series 7 licensed, or a screaming (rich) lunatic like Jim Cramer.  I was a poor kid working his way through college and decided to ride the .com financial wave.

And I did it well for years.  Mutual funds at first, then I graduated to dividend reinvestment programs direct from the companies themselves.  I owned Dial Corp, you know, the company that made Dial soap.  Soap!  Finally I got a real investment account from E-Trade.  I became a high flyer with my $1,000 account.  A funny thing happened along the way.  Stocks soared, I earned more and invested more.  All of a sudden, I'm watching stock prices every five minutes. Arrive at work, check messages for a bit, then check My Yahoo page for latest 15 minute delayed quotes.  Run a report, check the prices again.  Go to lunch, come back, check stocks before getting back to business.  4:30 rolls around, check for any end of day deals.  Finish work, head to happy hour and go home to check closing prices.  Repeat.

Then 2008 came around.  Does anybody but the media and those that work in the market check prices anymore?  I just realized I haven't looked at my dismal portfolio since Thanksgiving.  Sure, I hear or see prices in passing, but I'm not hung up on it.  What's the price of Apple today?  Who knows, who cares.  Sure the recession sucks, but it helped me in one aspect.  I saved time checking stocks.  Unfortunately that time got filled pretty quickly with Twitter and other time-sucking activities on the Internet.  Market please come back.  At least that obsession earned me money.
The House of Representatives rejected the $700 Billion bailout bill proposed by Secretary of the Treasurer, Henry Paulson and the Bush Administration.  The market responded in turn by dropping nearly 800 points.

A few months ago, I suggested that investor panic was irrational.  Today's reaction was not.  The bailout plan, while costly and very risky, was what the market in general wanted, actually maybe even needed.  Representatives from both sides were thinking about their current constituency and the reaction to such a large number, had the bill passed.  The problem is that they are not looking at the more important constituency...the future.

I'm not saying $700B is a drop in the bucket, but the ramifications of no bill are unimaginable.  If banks fail and the FDIC has to come in and save what they can, we'll end up bailing out too much anyways.  However that will come at two costs.  First, the account holders with more than $100,000, as they'll lose most every penny over that.  Second, the future spenders of America.  Those of us who own homes now have to ensure that we keep it that way.  Because it will be more difficult and costly to refinance or buy new property.  Simply the less diverse batch of banks, the less chance of good deals.

Right or wrong, some bailout bill needs to be passed.
So this was supposed to be the one about the War on Terror.  Events of the week however, put the Economy as subject #1, taking about the first half hour of the debate.  Same old, same old.  McCain to reduce taxes on the wealthy, cut spending.  Obama to reduce taxes for the needy, control spending, but spend where needed.  Of note, McCain wants to reduce the overall budget.  I wonder where from.

I did live blogging on the debate on Twitter and reading other Twitters while watching the debate.  The debate overall was boring, except McCain's references to Miss Congeniality.  That was hilarious.  I didn't know the Senate was a beauty contest.

It appeared that McCain was fresh and active, like he took a case of Red Bull before hitting the stage.  Obama, however, looked very tired.  The campaign has aged him.

Everything discussed tonight were things we've heard from the candidates in the past.  No new info.  It was boring and a draw.  However, one could say the Obama won because the War on Terror is McCain's strong suit.

On to the next debate, assuming McCain does not suspend his campaign beforehand.
I'll start with the fact that I am not an investment advisor.  Anything I write here is strictly my opinion and should not be construed as advice.  It's simply the way I invest and see the market.

Well, I was met with much joy today.  Apple stock down $15.50, just a bit over 10%.  I've been investing since 1991.  I even remember the my first investment, in a little mutual fund called Monetta Funds.  I liquidated that in the late 90's for a 30% gain so I could wildly invest in anything with "Tech" or "Silicon" or ".com" in the name.  And those I did pretty well in, probably average 20% gains, although mostly short-term, so I paid through the nose in taxes.  I would have done better, but I waited until I was sure the tech boom bottomed out before bailing.

Back to Apple.  The first shares I bought about 3 years ago are at a cost basis of about $15/share.  So I have a 10x + gain as of the current market value about $150/share.  Today's drop is in part because Apple is only predicting a Q4 earnings per share of $1, when analyst's had previously forecasted $1.23/share.  This reminds me of CVS Caremark (back then just CVS Corp) in around 2004 when they announced a penny difference in EPS and their stock dropped 15 or 20 percent.

What's wrong is that both Apple and CVS in their respective big drops are that they are still profitable companies.  Investors panic.  I am not saying Phil Gramm was right that the economic problems are mental, but these two instances and the tech boom are instances that the market is not for the faint of heart.

Long Term is the way to go.  I said I bought my first shares of Apple around $15?  I worked for CVS and started in their Dividend Reinvestment Program in 1992.  They started an Employee Stock Purchase Plan in 1994 or so.  My shares cost me between $6 and $20 per share in that timeframe.  Current market price?  About $40/share.  How's that for growth?

My point?  The market is all one big mental pot with millions of brains in it.  But clearer minds prevail in the long run.

Again, I am not an investment advisor, however I do still own shares of Apple and CVS Caremark.  Do not take this information as advice without seriously researching the equities you plan to purchase.

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