Down goes the Dow

Yes, I mean real investing, buying real stocks, like Ben Graham. I know a bunch of successful people in the Newport Beach area that own Mercedes. I don't know anyone who got there by investing in mutual funds. And among the Forbes Richest list, I see people who got there by investing like Icahn and Paul Allen, I see people who got there by Hedge Funds like Soros and Dalio, I see Edward and Abigail Johnson ($20 billion between them) who got there by owning Fidelity.

Now tell me, where are the people who invest in mutual funds? That's why I'm the only person on this whole website, it seems, with an honest-to-God S Class.

coach,

Benjamin Graham would find it hard to find value in today's market and I doubt he would be a buyer. Buying individual stocks has worked for you and you have put in the time and effort to make it work. For most Americans that is neither practical or adviseable. As a general rule of thumb I would never advise a client with under $200k to exclusively own individual stocks and bonds. It is too hard to achieve proper diversification, and diversification is the single most important factor in portfolio performance. Most of the individuals on the Forbes list attained their wealth thru other means than stock investing. Granted they maintain and increase their wealth doing so, but at that level of wealth owning individual investments is the most efficient platform. It largely does not work the other way around.

On a final note, one can gauge self worth on material things if one chooses. I assume people have a variety of things to spend their discretionary money on including automobiles and or a Newport Beach lifestyle. My wife and I were born and raised in Santa Monica and left in 1975 never to return. We have the means but not the interest in owning an any-Class Mercedes. We will celebrate our 41st anniversary on Monday and we are happy and healthy. What more can one ask for.

Igy

coach d wrote:

Yes, I mean real investing, buying real stocks, like Ben Graham. I know a bunch of successful people in the Newport Beach area that own Mercedes. I don't know anyone who got there by investing in mutual funds. And among the Forbes Richest list, I see people who got there by investing like Icahn and Paul Allen, I see people who got there by Hedge Funds like Soros and Dalio, I see Edward and Abigail Johnson ($20 billion between them) who got there by owning Fidelity.

Now tell me, where are the people who invest in mutual funds? That's why I'm the only person on this whole website, it seems, with an honest-to-God S Class.

It's hard to tell if you are trying to be funny. If so, you've failed pretty badly. If not, well that's even worse.

Hate to point it out to you but, after trading costs are included, individual investors are more likely to trail the overall market than not and will certainly have far less predictable returns (which is considered undesirable by most). So, folks should be jumping out of low-cost index funds in order to become stock pickers and market timers why again?

Oh, and "an honest-to-God S Class"?!? OK, maybe that was your lame idea of humor. At least I'd hope so. The alternative is just too pathetic.

I agree. I imagine most small investors in individual securities do rather poorly, and those investors have had the wind at their back. I would say these investors provide liquidity for the larger players. Most small stock players will learn it is a serious and a more difficult game then they currently believe. Most will be holding devalued securities when the current cycle is complete.

For the week 10-year Treasury up 1.2%, Dow and S&P up about 0.60%.

hmmm where's agip been?

Vacation probably.

I believe the market is going to struggle over the next couple of years. All the the quick money strategies will be proven Ponzi schemes. And all the fast money traders will be forgotten. The Najarian brothers will depart CNBC to be high school football coaches. Stock investing will not be fun anymore.

Investing is not buying lottery tickets in companies that will never be profitable. Stocks should be able to demonstrate consistent cash flow to be investable. Today's investors want"money for nothing and flips for free."

Igy

This week Tesla had another equity raise. It reportedly went off well. The stock price actually went up and it raised more cash than planned. It well largely because Elon Musk put about $20 million of his own money into the equity raise.

But let me pose a question to you all.

Its very likely Musk paid that $20 million through a personal loan, at very low interest rates, secured by his Tesla stock. I believe his Tesla stake is about $5 billion (give or take).

What is the substance of that transaction? How much is Musk really putting his own "skin" in the game? I do credit Musk for taking a loan and plowing it into his company. In contrast to to Larry Ellison who takes out billions in personal loans to buy private islands, mansions, and Yachats. Still, it strikes as a little shallow by Musk. In a worst case scenario, Tesla stock plummets. The bank demands more collateral or seizes the collateral. Musk is forced to sell Tesla stock which drives Tesla stock down. That effects all Tesla shareholders.

Ryan,

I find Tesla to be one of the most over priced and Ponzi like stocks out there. Elon Musk is quite the gamesman to keep this scheme rolling along. The company is burning through cash quickly and the hurdle to profitability is very high. If the cash burn follows the current trend the equity holders will go to zero and the creditors will own the company. People who buy the stock are gamblers at best and fools at worst.

Igy

Every time you link David Stockman, you're credibility takes another hit. At this point, you're running on fumes.

POTO,

OK. Go buy TSLA. I will get the last laugh and so will Stockman. You are just a clone of the Wall Street media machine.

At least the things I post have some substance. You POTO, onstantly show you have your head up your @$$.

Igy

Ghost of Igloi wrote:

POTO,

OK. Go buy TSLA. I will get the last laugh and so will Stockman. You are just a clone of the Wall Street media machine.

At least the things I post have some substance. You POTO, onstantly show you have your head up your @$$.

Igy

It's spelled like this, 'ass'.

Now please stop posting nonsense that makes it look as if you are using your ass to generate your ideas.

Poof!

POTO,

I have yet to see anything posted from you that adds to the conversation. On the other hand, the Stockman chart directly addresses Tesla's cash burn.

Grow up when you get a moment junior.

Igy

I wouldn't say that POTO has added nothing to the conversation. He has reminded us that Stockman is not really a good source given his catastrophic investment failures.

Meanwhile, the article linked above leaves a lot to be desired. I think the author misinterprets/exaggerates the effects of falling oil prices and rising interest rates.

Sally V,

Ignore the source if you like. Here is another gem:

http://davidstockmanscontracorner.com/how-the-wall-street-ponzi-works-the-stock-pumping-swindle-behind-four-retail-zombies/

Igy

Increased retail sales is a bad thing? The guy's a loonie.