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<\/p>\nThe stockmarket is booming, again. Here’s this year’s three major indices. The blue one is the S&P 500.<\/p>\n
<\/p>\n
Half the investing world thinks we’re going back to work and the economy will henceforth be honky dory. Hence rising stock prices. Back to full employment. In a blink of an eyelid.<\/p>\n
The other half believes what a dear Conservative friend wrote me:<\/p>\n
I\u2019m almost convinced we will \u00a0be facing a near term and long term financial disaster. I need to rethink the makeup of my family\u2019s asset allocation. We need to look at \u00a0investments clinically, without political bias and emotion.<\/p>\n
I now believe Trump will lose in November and take the House and Senate down with him. Covid-19 will take its toll on his support which has been problematical anyway and the economy will rejuvenate much slower than planned, his heretofore ace in the hole.<\/p>\n
These are the assumptions I\u2019ve been formulating:<\/p>\n
1. Republicans lose all three branches of Government. Democrats will mismanage the economy and health care.<\/p>\n
2. No vaccine for Covid-19 is available for widespread use until 2022.<\/p>\n
3. Problematic use \u00a0of mitigation drugs.<\/p>\n
4. Antibody tests for immunity show too many \u00a0false positives.<\/p>\n
5. A strong re occurrence of Covid-19 in fall and winter.<\/p>\n
6. Continued skepticism about safety by the public and therefore slow to re-engage.<\/p>\n
7. Continued to worsening unemployment in the US and the world.<\/p>\n
8. Whole industries disappearing, i.e., restaurants, travel services, airlines, cruise ships, movie theaters, entertainment events, conventions.<\/p>\n
9. GDP down 30-40% for 2021. Higher internationally.<\/p>\n
10. Huge world debt to refinance.<\/p>\n
11. State debt defaults or bankruptcies, loss of principal for Munis.<\/p>\n
12. Education in crisis, schools closing and teachers unemployed.<\/p>\n
13. Dramatic increase in crime.<\/p>\n
14. Trade imbalances will resume as China reneges.<\/p>\n
15. No serious action will be initiated by Biden\/Hillary\/Michelle\/Newsome\/Cuomo (take your pick)<\/p>\n
So far this year, the correct <\/strong>action for successful investing has been to do absolutely nothing<\/strong>.<\/p>\n If you had not owned the industries I have been railing against — like energy, banks, retail and airlines — you’d actually be up a smidge this\u00a0 year.<\/p>\n Sleeping through crises is a viable investment strategy.<\/p>\n Going forward?<\/strong><\/p>\n Here is my “brilliant” going forward strategy:<\/p>\n + Stock prices are largely over-priced — based on standard value theories of earnings, growth, dividends, etc. Hence few bargains left, though I continue to look.<\/p>\n + Stock prices today are based on several things — heavy emotion, “hot” areas (like stray-at-home stocks). Emotions can evaporate from one moment to another, as they did in late February\/early March.<\/p>\n + When things are uncertain (as of now), my “strategy” is called diversification and be opportunistic. Hold lots of cash to be able to pounce, if something good comes along.<\/p>\n + Wear a mask. Stay distant. Wash your hands. Don’t touch your face. The usual stuff.<\/p>\n + Stay normal. Stop panicking. Stop freaking out. Do what I can for the family. Play oodles of tennis. Don’t get too fat.<\/p>\n Two disasters: Credit cards and Telephone Call Centers<\/strong><\/span><\/p>\n + Citicard is changing the number of my main MasterCard credit card. They want to give me a card I can tap. Which I need like a hole in the head. I have no choice. Scr*w Citicard. And change all my auto-pays.<\/p>\n + Suddenly spurious fraud charges are appearing on my Citi MasterCard. I can’t dispute them until they are “posted.” Whatever that means.<\/p>\n + My Chase Amazon Visa credit card has so many 5-4-3-2-1% rebates. They sound great, but aren’t because I need to call them to redeem the “points” I earn into dollars, bitcoin or buffaloes. Or whatever.<\/p>\n + All customer “service” phone centers are blaming their 2-hour waits on the virus. I thought their people were answering the phones at their homes. There’s a million companies that provide that service, .e.g. Ring Central. There’s a list here<\/a>. <\/strong>For me, the simplest solution is to have Verizon FiOS ring my Manhattan office number and my cell phone simultaneously.<\/p>\n Enticed by all the “bargains” from places like Nordstrom,\u00a0 I spent a little money buying stuff I didn’t need. That was a disaster because of their messed-up computer systems. (All retailers’ online systems are a mess– except Amazon). Nordstrom kept one and a half hours on hold. Eventually they promised they’d fix my problem, but didn’t.<\/p>\n Meantime, I’m off buying anything and everything. And I’m back to using cash. What a simple idea. I give them money. They give me change. I don’t have to check the bill, check some distance computer…<\/p>\n If it’s two sandwiches, it’s $12. I have the sandwiches. I give them $12 cash.\u00a0 They have the cash. No plastic. No computers. No call centers. End of story. Cash is wonderful.<\/p>\n 52 days in quarantine<\/strong><\/span><\/p>\n I read why we need to open up. We’ll kill each other if we don’t.<\/p>\n This is tasteless, but very funny.<\/p>\n\n