More good reasons not to own stocks. Any of them. I have some excellent “Insights”

10 October 2022, 9:53 am

Cover of the weekend’s Financial Times:

Today’s lead article from CNBC.com:

And from the New York Times:

You can read the rest of this depressing piece here.

The New Reality is the Old Reality.

We are in a long-term bear market.

That market will be marked by occasional strong upward bounces in stock prices, like those we saw early last week. But for the next year or so, it’s down, as the Fed wrestles to cut inflation — also called throwing the world economy into a recession.

Nobody’s in favor of this. Financial advisers and managers don’t get paid if you’re in cash or in treasuries. But that’s where you should be. I have oodles of treasuries. But I’m waiting on November 1-2 when the Fed meets and bumps interest rates another 75 basis. And presumably treasuries will pay more. One to two-years are my favorite.

What bothers me most is not that stocks are falling — I’m short a bunch and they’re all doing well, But it’s the unpredictability of something weird happening — A Black Swan Event.

The world of finance is loaded with people who think they know better. They borrow money from lots of dumb, desperate lenders. They take huge bets. When the bets turn down, everything they own is clobbered. They’re forced to sell even their good stuff.

Bingo, we have a Long-Term Capital Management. Remember them? LTCM was a hedge fund that used so much borrowed money from U.S. banks to speculate on international bonds that its collapse threatened the solvency of the entire U.S. financial system. They blew up in 1998. Which was not that long ago.

I have a huge Watch List of Stocks I Like. They have great businesses and oodles of loyal customers (e.g. Ford), but they keep falling, like Ford this year:

The New York Times wrote:

+ The near collapse of the British bond market may just be the canary in the coal mine, indicating that there are unknown or unrecognized pockets of leveraged speculative bets in both near and far-flung corners of the globe.

Or Putin will do something really desperate, drop a nuke and …

Insights

+ Don’t buy inverse ETFs — the ones that benefit you when the market goes down. They’re for day-traders, not for you or me.

+ Don’t buy treasuries until the next rate hike at the next Fed meeting which is November 1-2.

+ Watching TV? Spend the time unsubscribing from your unwanted spam emails.

+ Need a new iPhone? The best choice is the iPhone 14 Pro Max with 256 gigs. It costs $1199, the exact same price you can now buy an older iPhone 13 Pro Max with 256 gigs. Buy it from an Apple Store. Get the geniuses there to transfer all your stuff over. Make sure all your stuff is backed up into Apple’s Cloud.

+ If you check your bags, make them distinctive. Reader Barry Y. got his bag picked up by mistaken fellow travelers. He tracked it via the Apple AirTag he had inside his bag. And got his bag back. He can’t speak enough about AirTags. To buy your AirTags, click here.

+ Major benefits of living in the country (i.e. away from New York City): no noise, cleaner air, faster Internet (ten times faster than what I have in the city), friendlier people, and lower prices on everything.

+ Flying today is awful. Flights are late, oversold and changed randomly. Qantas changed my LA-Melbourne non-stop to LA-to Brisbane, then to Melbourne. Hours later. They say their job is to get me there, not necessarily with the original routing. My brilliant travel agent, Barbara Freedman fixed it for me. No one else could.

+ Car and truck prices are rising. Get in quickly if you need to buy something. I recently bought the dealer’s 5,000 mile “loaner” at a ridiculous price. But the car had neat new safety features. The kids are encouraging me to stay alive. I’m not sure why, given the aggravation I put them through daily. My “new” car, a Subaru Outback Limited XT.

+ I’ve now had a flu shot and a fifth covid multi-variant shot. I got the covid shot at CVS. I love those guys. Easy to deal with. My arm hurt for a few hours, then got better.

+ Walking at a brisk pace for about 30 minutes a day leads to reduced risk of heart disease, cancer, dementia and death, compared with walking a similar number of steps but at a slower pace. 9,800 steps a day offered the highest level of protection. Click here.

+ Don’t believe any ads for crypto by celebrities, e.g. Kim Kardashian or Matt Damon. Brilliant ad:

Kim was charged with failing to disclose that she was paid to promote a crypto offered by EthereumMax. She got paid $250,000 but owes the SEC $1.26 million. Here’s crypto expert, Kim: