Financial question...

"Wayne.B" <waynebatrecdotboats.DeleteThis@hotmail.com> wrote in message
news:2tjpa4lt843q4a4pmkrcvdjogp31iktsa7@4ax.com...
> On Wed, 20 Aug 2008 21:50:35 -0400, John H.
> <salmonremovebait@gmaildotcom> wrote:
>
>>Well yeah, but what do you see in the economy going forward?
>
> No one knows for sure. Long term it always recovers but the timing is
> uncertain as is the sector rotation. The keys to investment success
> are not really a secret:
>
> 1. Good solid companies that have been around a while and pay
> dividends.
>
> 2. A widely diversified portfolio.
>
> 3. A track record of competent management and building shareholder
> value.
>
> 4. Good value vs assets and future income stream.
>
> Trying to time market tops and bottoms is a risky game. Picking good
> companies at a good value is easier. I continue to like the big
> integrated oils over the long term as well as some of the exploration
> and drilling companies. None of them will double your money in 6
> months but you really shouldn't be trying to do that.
>


We never played in the stock market at all until about 8 years ago. At that
time we decided to take a small amount of money and try our hand. Not
knowing anything about it, we bought stock in about 6 technology based
companies ... two that were highly speculative, high risk, and four that
were larger companies that although they had been around for a while, were
suffering from the telecom fiasco and the stock prices were at a low. I was
familiar with the companies and felt that the four still had promise in the
future, once they recovered.

The two high risk companies have long since gone belly up. But the other
four have recovered nicely, one in particular, and, even now in the current
slump, we have almost quadrupled our total, initial investment including the
losses associated with the two that went belly up.

Eisboch

On Wed, 20 Aug 2008 16:40:58 -0400, John H.
<salmonremovebait@gmaildotcom> wrote:

>On Wed, 20 Aug 2008 20:34:15 GMT, Short Wave Sportfishing
><email DeleteThis @swsportsremove.org> wrote:
>
>>On Wed, 20 Aug 2008 16:16:32 -0400, John H.
>><salmonremovebait@gmaildotcom> wrote:
>>
>>>Would it be a wise move to take out a loan on your home to buy stocks?
>>
>>No.
>>
>>>Would it be a wise move to sell stocks to pay off a loan on your home?
>>
>>No.
>
>You're sounding too much like McCain. A little explanation would be muchly
>appreciated.
>
>When I think of the future, re: the stock market, I see doom and gloom
>because of rising oil demand and reduced oil supply. I see very few
>businesses that aren't affected by oil costs. The market has not been
>performing all that well, and I don't see anything on the horizon that may
>help it. It's for damn sure the election of Obama wouldn't be a help to it.

Economies run in cycles and this is a cycle is which the wise choice
is to just sit on what you have and accept that things will improve in
time.

Europe is tanking, there are signs that India and China are on the
cusp of a major recession cycle and the only economy that still can
hold it's own against changing economic climates as evidenced by the
fact that we're still not bottoming out with a relatively strong GDP
compared to historical economic patterns. This economy is positioned
to take advantage of the global down turn in economic activity.

Oil is still unsupportable at this level and will return to a more
rational and malleable $70-80/bbl range - perhaps not as quickly as I
thought, but certainly by December rather than October.

The dollar has shown signs of strength against the Euro and the Pound
- it will quickly return to the harbor of refuge status because
Europe's economies are in a bind and cannot lower interest rates which
would cause major fluctuation with upward inflationary pressure if
they tried - and their inflation rate is currently hovering around 11%
in aggregate. Twenty five point basis cut results in another 1.6%
rise in inflation year-over-year. Can't do it.

Which means that we're in good shape nominally.

In uncertain times, at 5.18% compared to the running daily average as
of today of 6.93%, you've got a loan with cheap money at a rate that
won't be seen for another 15/20 years.

This does not mean that you should not take profits where you can and
if inclined, instead of investing them back, take a portion and pay
down house principle - that is always a smart idea. The rest can be
reinvested short term outside of securities. The key is to do it over
time with a long range goal rather than dumping everything. Be
selective.

Lastly, understand that the big money is still sitting on the
sidelines neither selling or buying and holding what they have. That
should tell you something. Keeping yourself positioned and your
powder dry is the best bet.

Help out any? :>)