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Coronavirus Investing

Discussions about the economic and financial ramifications of PEAK OIL

Re: Coronavirus Investing

Unread postby Newfie » Mon 26 Oct 2020, 07:48:52

VT,

Yes, we are pretty similar. In observations of others and our situation. We are “comfortable” because we were personally responsible. We too carry no debt.
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Re: Coronavirus Investing

Unread postby REAL Green » Mon 26 Oct 2020, 07:59:08

Newfie wrote:VT,

Yes, we are pretty similar. In observations of others and our situation. We are “comfortable” because we were personally responsible. We too carry no debt.


There is nothing at all wrong with responsible debt. I have a mortgage which is smart considering how low rates are and the tax benefits. I have a tractor financed. The responsibility of my debt for me is I have income and I have investments that means I have positive cash flow and positive net worth. In fact I would say no debt is an extreme. I am not saying this is wrong just that it is an extreme financial position.
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Re: Coronavirus Investing

Unread postby vtsnowedin » Mon 26 Oct 2020, 10:58:50

REAL Green wrote:
Newfie wrote:VT,

Yes, we are pretty similar. In observations of others and our situation. We are “comfortable” because we were personally responsible. We too carry no debt.


There is nothing at all wrong with responsible debt. I have a mortgage which is smart considering how low rates are and the tax benefits. I have a tractor financed. The responsibility of my debt for me is I have income and I have investments that means I have positive cash flow and positive net worth. In fact I would say no debt is an extreme. I am not saying this is wrong just that it is an extreme financial position.

Oh I agree. a house for you and your family and the car or truck you drive to work and even the tractor if you need it are better deals then renting them. But by the time you retire those debts should be paid off except perhaps the current vehicle. Big debts on credit cards and RVs and second homes are what I think people should avoid especially when they get older.
Side note I bought my tractor for zero percent interest and it has been the most useful thing I have ever bought.
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Re: Coronavirus Investing

Unread postby Newfie » Mon 26 Oct 2020, 14:53:39

Yes f course ai have had debt when younger. Mortgage and car.

I bought a new car and financed it. After 3 years paid off, so. Took that “monthly payment” and made a deposit to my bank account every month. Bought the next car cash. And so it has been.
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Re: Coronavirus Investing

Unread postby vtsnowedin » Mon 26 Oct 2020, 18:30:04

The market took a hit today based on bad news in Europe and the realization that Biden will probably win. Also any new stimulus package will probably come after the election and include all of the Pelosi giveaways to blue state governments in it.
I console myself in that my stocks only went down about half as much as the broader market and if the trend continues there might be a bottom to fish on.
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Re: Coronavirus Investing

Unread postby evilgenius » Tue 27 Oct 2020, 19:43:41

vtsnowedin wrote:
REAL Green wrote:
Newfie wrote:VT,

Yes, we are pretty similar. In observations of others and our situation. We are “comfortable” because we were personally responsible. We too carry no debt.


There is nothing at all wrong with responsible debt. I have a mortgage which is smart considering how low rates are and the tax benefits. I have a tractor financed. The responsibility of my debt for me is I have income and I have investments that means I have positive cash flow and positive net worth. In fact I would say no debt is an extreme. I am not saying this is wrong just that it is an extreme financial position.

Oh I agree. a house for you and your family and the car or truck you drive to work and even the tractor if you need it are better deals then renting them. But by the time you retire those debts should be paid off except perhaps the current vehicle. Big debts on credit cards and RVs and second homes are what I think people should avoid especially when they get older.
Side note I bought my tractor for zero percent interest and it has been the most useful thing I have ever bought.

I think borrowing is best left for assets. Borrow to buy something that will pay not only for itself but make a profit. But I can be a hair shirt about these things. I was once in debt, and never have been again. There are lots of things I shut myself off from because of this, not just the bad things.

On that note, what do people think about Ant Group? They are a new way of providing finance, one that knows more about you through data collection. They are supposed to be in competition with regular banks. They are supposed to be better. I wonder if that is true? The banks are down right now. Does the uproar over Ant signal a change? Is it time to get into banks?
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Re: Coronavirus Investing

Unread postby vtsnowedin » Wed 28 Oct 2020, 04:38:29

evilgenius wrote:On that note, what do people think about Ant Group? They are a new way of providing finance, one that knows more about you through data collection. They are supposed to be in competition with regular banks. They are supposed to be better. I wonder if that is true? The banks are down right now. Does the uproar over Ant signal a change? Is it time to get into banks?

I had not considered them yet preferring to go with established dividend paying companies. But now that you mention it Ant group looks like a very interesting IPO with a good future ahead of it and multinational reach. Hear is a piece discussing their prospects and investors.
https://markets.businessinsider.com/new ... 029727294#
Warren Buffett may be looking forward to Ant Group's public debut in the coming weeks, as it promises to pull some of Berkshire Hathaway's lesser-known investments into the spotlight.

Alibaba cofounder Jack Ma spun off Ant from the Chinese e-commerce giant in 2011, but still owns 8.8% of the affiliate. Ant owns Alipay, China's leading online-payments platform. It is seeking to raise more than $34 billion via a dual listing in Hong Kong and Shanghai, setting the stage for the biggest initial public offering in history.
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Re: Coronavirus Investing

Unread postby REAL Green » Wed 28 Oct 2020, 05:38:05

vtsnowedin wrote:
evilgenius wrote:On that note, what do people think about Ant Group? They are a new way of providing finance, one that knows more about you through data collection. They are supposed to be in competition with regular banks. They are supposed to be better. I wonder if that is true? The banks are down right now. Does the uproar over Ant signal a change? Is it time to get into banks?

I had not considered them yet preferring to go with established dividend paying companies. But now that you mention it Ant group looks like a very interesting IPO with a good future ahead of it and multinational reach. Hear is a piece discussing their prospects and investors.



The financial world is a Ponzi but in China it is centrally controlled and used to promote the Chinese image. What could go wrong! LOL.

“This is absolute bubblelicious insanity, and it explains not only why the Ant IPO is so massively oversubscribed, but why the stock will shoot up on the first day of trading. The reason: because this particular IPO is nothing but a government mandated ponzi scheme, one in which state-owned banks give loans to retail investors who have to put almost no capital of their own down, to ensure there is massive demand for a stock which, by going public just days before the election, has a special political appeal to it: it is meant to symbolize China's superiority over the US.”

“World's Biggest IPO Is 284x Oversubscribed As Chinese Banks Give Retail Investors 33x Margin Leverage”
https://www.zerohedge.com/markets/world ... n-leverage

“Yesterday we reported that the world's biggest IPO - that of Jack Ma's fintech giant Ant Group - which priced on Monday at a valuation of over $320 billion and which will raise $34 billion in new capital, is set to break for trading later this week. Earlier today, Bloomberg reported that Ant Group's bankers would stop taking investor orders for the Hong Kong leg of the IPO a day earlier than scheduled as the record stock sale has already been heavily subscribed… These are staggering numbers, unprecedented for most Western IPOs. How are they possible? It turns out the answer is quite simple: local banks are showering potential buyers with margin loans, just to make sure that the stock soars after it opens for trading… According to SCMP, Huatai International, the Hong Kong arm of the fourth-largest mainland securities house, will lend at 33 times leverage for Ant’s IPO, meaning an investor would only need to put down roughly HK$3 as a deposit to borrow every HK$100 they borrow. It's not just banks: brokerages are also seeking to attract business by offering leverage to retail clients applying for Ant’s shares. Online brokerage Tiger Brokers said apart from a lending capacity of “several tens of billion” dollars, it will offer 20 times leverage to investors to subscribe to Ant’s IPO… This is also why contrary to the expectations by China skeptics such as Kyle Bass, Hong Kong's fund flows continue to flood into the territory rather than out, because China has figured out that the simplest way to ensure it never has a dollar shortage is to guarantee that foreign investors will always make money on such massive equity offerings. And as long as China has companies that go public - and are 100x+ or more oversubscribed - the foreign capital inflows will continue. Which is the Ant IPO is about so much more than the world's biggest IPO - it explains how HK, and by extension China, funnels foreign (mostly dollar) capital to make sure that there is never a full-blown run on the world's reserve currency.”
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Re: Coronavirus Investing

Unread postby vtsnowedin » Wed 28 Oct 2020, 06:06:59

The fact that the Ant group is based in China is enough for me to look elsewhere.
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Re: Coronavirus Investing

Unread postby vtsnowedin » Wed 28 Oct 2020, 16:55:56

The markets all took a nosedive today and tomorrow doesn't look much better. I'm not going to panic and sell anything as what I have will win out in the end (or at least I think it will) . What I will do is hold off on planned purchases until it bottoms out and starts back up. A bit of bottom fishing as it were. No need to buy a stock today that might be had in a week or two for twenty percent less.
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Re: Coronavirus Investing

Unread postby evilgenius » Wed 28 Oct 2020, 18:44:45

vtsnowedin wrote:The markets all took a nosedive today and tomorrow doesn't look much better. I'm not going to panic and sell anything as what I have will win out in the end (or at least I think it will) . What I will do is hold off on planned purchases until it bottoms out and starts back up. A bit of bottom fishing as it were. No need to buy a stock today that might be had in a week or two for twenty percent less.

I was thinking the same thing, but realized there is nothing wrong with dipping one's toes at these prices for some things. You just want to enter a position, so that you can't ignore it as it goes down. You want to pick something that has inherent value, of course. Today I picked a banking stock, like I had been talking about. I needed to diversify into something like this, so I picked up NYCB at $8.08. I only bought enough to keep me in the game. I like this one, when things are better.

I was wobbling between this stock and an industrial stock, EAF. EAF makes electrodes for arc furnaces. If you have ever watched Dirty Jobs, you know those get used. That stock is set to run, when things get going. It's so cheap right now, but will probably stay that way for a little while longer, China worries dragging on the economy and hurting their story (vs. domestic loans), whereas NYCB has less of a chance of staying put.

I agree with you. I think things can go lower. But bottom fishing is difficult. You never know when things will turn around. You can get surprised, and left completely out of the money.
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Re: Coronavirus Investing

Unread postby vtsnowedin » Wed 28 Oct 2020, 21:18:51

I don't need or expect to hit the exact bottom. I'll just leave this months cash on the side or maybe even next months until we get a day or two of rising markets. It might go back to a downward trend the next day or so but I will have bought whichever stock or stocks I buy for less then I could have bought them for last week.
Take a look at Nextera energy, com (NEE).
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Re: Coronavirus Investing

Unread postby evilgenius » Thu 29 Oct 2020, 05:30:26

vtsnowedin wrote:I don't need or expect to hit the exact bottom. I'll just leave this months cash on the side or maybe even next months until we get a day or two of rising markets. It might go back to a downward trend the next day or so but I will have bought whichever stock or stocks I buy for less then I could have bought them for last week.
Take a look at Nextera energy, com (NEE).

I know what you mean. I bought something last go round that went lower afterward. Later, when things settled, I bought some other stuff and didn't add to that first position. That's why I only bought a small stake this time. I figure I can dollar cost average if that happens again.
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Re: Coronavirus Investing

Unread postby vtsnowedin » Thu 29 Oct 2020, 10:06:35

Investing 101 for sure. As long as you see the five and ten year prospects for a company as being equal to the market or better any short term dip in price is just an opportunity to buy more shares and lower your average initial cost per share. I don't know how that works out when it comes time to pay capital gains tax but I'm sure one of my children will have an accountant that is up on that. :)
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Re: Coronavirus Investing

Unread postby Outcast_Searcher » Thu 29 Oct 2020, 11:09:39

evilgenius wrote:
vtsnowedin wrote:I don't need or expect to hit the exact bottom. I'll just leave this months cash on the side or maybe even next months until we get a day or two of rising markets. It might go back to a downward trend the next day or so but I will have bought whichever stock or stocks I buy for less then I could have bought them for last week.
Take a look at Nextera energy, com (NEE).

I know what you mean. I bought something last go round that went lower afterward. Later, when things settled, I bought some other stuff and didn't add to that first position. That's why I only bought a small stake this time. I figure I can dollar cost average if that happens again.

And that kind of thing might or might not work out well.

OTOH, if you are working and you just dollar cost average into "the whole market", or broad index funds, EVERY month, year after year, decade after decade, it does work out well over time. Worst case has been it takes a few decades. Generally, it works out well after a decade or so as you're buying at a lower than average cost per share over time, just by the math, as long as you are consistent (which is easy in most 401-K plans, or most mutual funds will let you do that for any account type with modest minimums).

You won't rapidly get rich doing that, the the odds are overwhelming you'll do fine to well over time, vs. something more like, say, a 2 in 3 chance of doing well, and the downside being potentially REALLY BAD if you pick the wrong single or few stock(s) and put a lot into it/them by averaging down.

I speculate, as it's interesting, but I keep it to 10% or less of my portfolio.

The reason I mention this is far too many people (I'm NOT claiming you are one) tend to mistake speculation with investment, and end up regretting the results.

The risk component of investing matters a LOT re expected results over time.
Given the track record of the perma-doomer blogs, I wouldn't bet a fast crash doomer's money on their predictions.
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Re: Coronavirus Investing

Unread postby vtsnowedin » Thu 29 Oct 2020, 12:13:40

That is commonly heard advise and I will not dispute it for the average investor trying to build a portfolio intended as retirement assets.
I on the other hand am already retired and have my income streams coming in from social security and a fixed payout retirement fund managed by others.
All I'm risking here is some of my beer money.
Fedelity says my account resembles their "most aggressive" category which I find amusing.
I'm looking to buy a few cases worth of beer value of a stock each month to diversify what I have in hand looking for long term companies paying a good dividend with at least one each from each major market sector.
That leaves out all the IPOs and high tech wonder kids and anything with a P/E of over 30. So if I am aggressive now I will becoming less so over time.
I might turn a good profit and if I just bought beer with the money all I would have in the end would be a pile of empty cans to take back to the recycling center.
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Re: Coronavirus Investing

Unread postby Outcast_Searcher » Thu 29 Oct 2020, 12:41:10

vtsnowedin wrote:That is commonly heard advise and I will not dispute it for the average investor trying to build a portfolio intended as retirement assets.
I on the other hand am already retired and have my income streams coming in from social security and a fixed payout retirement fund managed by others.
All I'm risking here is some of my beer money.
Fedelity says my account resembles their "most aggressive" category which I find amusing.
I'm looking to buy a few cases worth of beer value of a stock each month to diversify what I have in hand looking for long term companies paying a good dividend with at least one each from each major market sector.
That leaves out all the IPOs and high tech wonder kids and anything with a P/E of over 30. So if I am aggressive now I will becoming less so over time.
I might turn a good profit and if I just bought beer with the money all I would have in the end would be a pile of empty cans to take back to the recycling center.

And that's all terrific, IMO. I was just trying to warn off folks that might get over-excited and financially hurt themselves. For someone like you who isn't taking undue risk AND knows what they're doing re the risk they're taking, that's probably a far better way to spend money than the vast majority who buy endless trinkets and end up with garages, attics, basements, etc. full of stuff they rarely use, or wildly depreciating fancy cars, boats, etc. I wish you all the success (and fun) in the world with your speculations over time.

I've seen people hurt themselves repeatedly, most notably greed during the latter 90's re the tech boom / bust, and panic during the end of the great recession, and bailing out at the worst time, in panic. For those not doing the financial equivalent of "running with scissors", by all means, carry on.
Given the track record of the perma-doomer blogs, I wouldn't bet a fast crash doomer's money on their predictions.
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Re: Coronavirus Investing

Unread postby vtsnowedin » Thu 29 Oct 2020, 13:10:55

In my younger foolish years I learned a few lessons at the school of experience. One of the lessons was called Palm. :oops:
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Re: Coronavirus Investing

Unread postby Outcast_Searcher » Sat 31 Oct 2020, 15:21:30

vtsnowedin wrote:In my younger foolish years I learned a few lessons at the school of experience. One of the lessons was called Palm. :oops:

You have TONS of company, including me, re technology. One of the insights the legendary Warren Buffett repeatedly mentioned was how hard it is to make money in car makers over time in the stock market. It might seem "obvious" on the surface, re technology investing, but it most assuredly is not.

I still suspect that Tesla has a few surprises for the dedicated fanboi cult, before the maturity of BEV's (re dominating the car market) is over (and of course, I could be very wrong, despite the huge valuation on the stock in recent months).
Given the track record of the perma-doomer blogs, I wouldn't bet a fast crash doomer's money on their predictions.
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Re: Coronavirus Investing

Unread postby vtsnowedin » Sat 31 Oct 2020, 17:52:37

Outcast_Searcher wrote:
vtsnowedin wrote:In my younger foolish years I learned a few lessons at the school of experience. One of the lessons was called Palm. :oops:

You have TONS of company, including me, re technology. One of the insights the legendary Warren Buffett repeatedly mentioned was how hard it is to make money in car makers over time in the stock market. It might seem "obvious" on the surface, re technology investing, but it most assuredly is not.

I still suspect that Tesla has a few surprises for the dedicated fanboi cult, before the maturity of BEV's (re dominating the car market) is over (and of course, I could be very wrong, despite the huge valuation on the stock in recent months).
I really thought Tesla was a good bet back when it was about $200 a share but I dawdled and missed the opportunity. Now I think so many have jumped on this band wagon that it is over valued and will have a hard time meeting expectations at some time in the near future. In my dreams some event or bad quarter cuts all the fluff off of it's price and I will be able to buy in at a quarter of the price today.
Not likely I know but I can see a lot of better choices to make. Maybe if the Biden administration sends me another stimulus check of $1200 to $2400 I will throw that "not my money" into a Tesla or some other high risk growth stock?
Better chances then blowing it on lottery tickets.
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