Hey Harry,
I went to cash yesterday in non taxable accounts which represent about 40-50% of our assets….
John O.
Well John, I’m happy for your psyche, though I think you’re needlessly panicking.
I hope you’re wrong. I’m not selling anything. I like my stocks. They’re listed — for all to see — in the right hand column of this blog. Click here.
Last night Susan and I saw the new West Side Story on Broadway. It hasn’t officially opened. It’s in previews.
The theater was packed with patrons paying nosebleed prices. None were wearing surgical masks.
There are always bad things happening in the world. How bad they are depends on your psyche. Clearly we’re not in a Big War. We haven’t invaded Australia, my home country, yet.
The media — TV, newspapers and magazines — long ago figured that bad news sold better than good news.
No one — except me here — reported last night’s full house. Though, to be even handed, I will report that Bernardo died in the end. But Maria survived, unlike Romeo and Juliet where they both died.
Today, the market will decline. You’d sort of expect that — not because of the coronavirus — but because it’s gone up so much recently. Even our stockmarkets got to catch their breath.
This morning I read Zoetis Q4 earnings are up 11% (and its shares will continue their rise). Heck, someone — many of us — are spending a lot of money on our beloved pets. Cut to picture of Rosie, who’s on a diet and needs a wash.
The market just opened. My Fidelity account is losing money. But not as much as it gained the previous day.
Big losses are Apple and Amazon — but not because they’re BIG losers — but because they’re my two biggest holdings. Hence the dollar losses are big — but not the percentages. BABA is bigger. But maybe they’ll report huge sales of masks. Mine just arrived last night from Amazon.
I plan on wearing them in crowded places like airports and subways. You can buy your box of masks from Amazon. Click here.
Three simple things to know about Wall Street
+ It likes growth. All decent companies grow and their stock prices grow in time.
+ Emotion figures how high prices rise. “Emotion” gets lots of help from the media and from our friends.
+ Unless you own a booming, profitable business, there’s nowhere else to put your money. Bonds and CDs are out.
That’s it. Go panic.
Trump’s serious about winning
CNBC reports that
White House to unveil Trump’s election-year budget calling for extending individual tax cuts
Key points
+ The fiscal 2021 budget projects the deficit will hit $1 trillion this fiscal year and linger at $200 billion after a decade.
+ It includes a plan to extend the disputed tax overhaul that Republicans passed in 2017.
+ The White House is proposing to continue tax cuts for individuals through 2035 at a cost of $1.4 trillion – a figure that serves as a rough placeholder for President Trump’s promised “Tax Cuts 2.0.”
+ The budget also assumes that interest rates remain at historically low levels despite projections for a strong economy.
None of his flock care about what my friends care about — the environment, immigration, the wall, the deficit, the national debt or Trump’s “character.” They care about a higher paycheck. Cutting taxes delivers that.
Remember the old election adage: It’s the economy, stupid.”
The saddest news
Many friends are not participating in this stockmarket boom for various reasons:
+ Crashes live eternally in their psyche. 2000. 2008, etc.
+ The market is too hard. not their shtich. (Not their thing.) They have a full time job and don’t have the time.
+ They give money to “money managers” and wake up years later to eye their miserable return. A friend gave money to one. Eighteen years later, my friend woke up to miserable 2.21% annual return. He emails me “The managers espouse a buy-and-hold philosophy, but I am curious if they’re making transactions primarily to get paid.”
He asks what should he do? His advisor put him in 11 different DFA mutual funds — from bonds to emerging markets, from small cap to large caps. Good funds, but not the place to be.
He would have done much better in two simple Vanguard funds — the total market (VTI) and the technology one (VGT). And even better in Apple and Amazon.
Should I tell him to fire his manager (save the 1% annual fee) and move his money into VTI, VGT, AAPL and AMZN?
Should I point out that he’s actually not paying a 1% annual fee, he’s actually paying a 45% annual fee. Figure 1% of 3.21%. That’s 45%.
By the way, my friend Ed who, a week ago, bought some puts on the S&P 500 and the QQQs, tells me he’s not negative on the market. In fact, he hasn’t sold a single share this year. He’s already up 9.5% in 2020. His portfolio is not dissimilar to mine — big in technology.
Your own business
Susan and I had to get a headshot for our honoring. I googled New York photographers, read their reviews and contacted several. Some were out of town. Some didn’t answer their emails. Some didn’t return my phone calls. One reluctantly agreed to shoot us — for $1100, or so.
Fortunately I lucked onto NY Headshots who answered their phone, made an appointment, confirmed it, walked us through the whole adventure, took zillions of great photos, send them to us, from which we chose this one:
That’s me in my $399 Ted Baker suit.
The point of this story — You are your own worst enemy. Treat your customers nicely and professionally. You’ll have plenty of them. I was so happy with Steven Cardone of NY Headshots I gave him a handsome tip. (At least for me, it was handsome.) Their web site is here.
West Side Story is beautifully done
If you liked the original, you’ll love this revamped, updated version. Heck, the Jets now have blacks. They were all white back then. The two leads playing Maria and Tony sing beautifully. I sung along. I could remember all the words — especially Dear Officer Krupke.
West Side Story has fond memories for me. I was in Australia at the time playing photographer to earn for college. A touring company visited Australia and I became their official photographer. I saw the show 12 times. The cast instructed me when to shoot. I remember them telling me to shoot at the end of Dear Officer Krupke when they would all scream “Dear Officer Krupke, F*ck you” (which was not in the script.) I sold a lot of those photos. Black and white. 8″ x 10″s. Mimosa paper. The photos were gorgeous. I printed them by hand. I shot on Tri-X. It was the sixties.
This week’s favorite New Yorker cartoons
Tomorrow is Valentine’s Day. We’re going to see the Sophie and Zoe for the weekend. We’ll play Memories and Uno. I won’t win. Sophie is so much better than me. She will enjoy beating me.
I just looked at Fidelity. My portfolio is up a little. Go pinch me.
See you tomorrow. — Harry Newton
Nice looking couple…you should keep them…Rosie too!
Harry – West Side Story is about Puerto Ricans – they’re not supposed to be black.
Great picture of Susan
They put blacks into the Jets, who were originally the all-white locals, which objected to the Sharks (the Puerto Ricans) coming to New York.and taking over their territory.
OK – its been a while since I saw that
For some reason I always thought the Jets were Italian-American. In any case, it’s good to know they are diversifying.
Harry,
Considering that much of China has shut down their factories due to the virus, do you have any thoughts about how this might eventually affect the market?
Do you think the financial media is playing this down?
I don’t think the local media has enough information to play it one way or the other. They report what they have.