Ain't that the truth. But, not everything changes. Another stock that never seems to go down, is beer companies. A family friend owned the Budweiser distributorship in our town when I was growing up. During the Carter administration, when so many businesses were sucking air, he was making money hand over foot.
Is it time to liquidate your investments?
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Ain't that the truth. But, not everything changes. Another stock that never seems to go down, is beer companies. A family friend owned the Budweiser distributorship in our town when I was growing up. During the Carter administration, when so many businesses were sucking air, he was making money hand over foot.
menzies
Guru
That's because he had lots of liquidity!
I just took a look at the last 12 months. We're up 2% the last three months and 20% the last 12. I don't attribute that to skill as much as luck.
First, we don't invest in department stores and clothing stores and clothing manufacturing stocks because we're heavily invested directly in those industries. That has protected us from losses in those stocks. Only invested in one, VF and it's down 24%.
But then I look at the stocks that are up and they're all overvalued in my mind. Amazon's up 29% the last three months and 39% the last year. Their profits in no way support that and they have many problems ahead. Costco is up 28% for the 12 months but already seeing a drop as only 1% the last three months. I can't make any logic of Microsoft being up 49% except investors scared of other things. Berkshire Hathaway, GM and Disney down, as are 3M and Pfizer. Meanwhile Home Depot, Lowes and Proctor and Gamble are riding a wave and up 33%, 42% and 15% but it's not like things are great for them, just not as bad as for others. Bank of America, Walgreens, Travelers, McDonalds and Verizon down. However, Johnson and Johnson, Kroger and Logitech up 12%, 42% and 60%. However, there is nothing substantially changed to make them long term more successful, just riding the pandemic wave. Then Shopify up 180% and it must come back to earth.
The problem to me is the fundamentals of the stocks that are up do not support it. Shopify has never made a profit. Home Depot and Lowes haven't improved. They just didn't do as bad as others during the pandemic. Kroger hasn't gained market share.
Some of the strong stocks seem to me to only have done well because investors have seen them as not as bad as others, not great, just not as bad.
I still think the market is greatly overvalued and even the good stocks must come back to earth. To the person who invested in Zoom, it was a brilliant investment but now going forward Zoom faces a very competitive market place with some very strong players.
I really don't feel there will be a lot of industries or companies that aren't impacted by the economic disaster we are entering.
First, we don't invest in department stores and clothing stores and clothing manufacturing stocks because we're heavily invested directly in those industries. That has protected us from losses in those stocks. Only invested in one, VF and it's down 24%.
But then I look at the stocks that are up and they're all overvalued in my mind. Amazon's up 29% the last three months and 39% the last year. Their profits in no way support that and they have many problems ahead. Costco is up 28% for the 12 months but already seeing a drop as only 1% the last three months. I can't make any logic of Microsoft being up 49% except investors scared of other things. Berkshire Hathaway, GM and Disney down, as are 3M and Pfizer. Meanwhile Home Depot, Lowes and Proctor and Gamble are riding a wave and up 33%, 42% and 15% but it's not like things are great for them, just not as bad as for others. Bank of America, Walgreens, Travelers, McDonalds and Verizon down. However, Johnson and Johnson, Kroger and Logitech up 12%, 42% and 60%. However, there is nothing substantially changed to make them long term more successful, just riding the pandemic wave. Then Shopify up 180% and it must come back to earth.
The problem to me is the fundamentals of the stocks that are up do not support it. Shopify has never made a profit. Home Depot and Lowes haven't improved. They just didn't do as bad as others during the pandemic. Kroger hasn't gained market share.
Some of the strong stocks seem to me to only have done well because investors have seen them as not as bad as others, not great, just not as bad.
I still think the market is greatly overvalued and even the good stocks must come back to earth. To the person who invested in Zoom, it was a brilliant investment but now going forward Zoom faces a very competitive market place with some very strong players.
I really don't feel there will be a lot of industries or companies that aren't impacted by the economic disaster we are entering.
BandB, thanks for posting the info about which stocks have gained and how much. I agree with your comment about investors seen some stocks as not as bad as many others. I'll go with that for now but am watching how things do. I suspect if we don't get this rioting under control and don't have a COVID vaccine by year end we'll likely see a drop in the overall market. How steep, how deep and for how long is anyone's guess.
I'm one who bought Zoom and I've enjoyed the ride. I thought about putting a sell stop order in but have decided to just ride it. As I've said before, I'm not trader but rather a long term investor.
For now, the ride is enjoyable. I'm almost back up to the account value at the time I moved it to E*Trade. Another 10% rise and I'll be whole again.
Fingers crossed GFC
Zoom is a bit like our Shopify purchase. We knew what the value and cost of web software was and a lot of companies use Shopify. Still, they've never made a penny.
Sometimes we see our need and buy. Sometimes that's not wise. We have some businesses that are only successful because we have other businesses buying from them.
Then there are those stocks I look back and can't recall any logical reason I bought. Guess I should make notes as I have no reason today why I bought Bank of America, Duke Energy, Travelers, Verizon, or Walgreens. I think I just thought I needed one in each industry and through a dart. I think I may sell those simply because I don't like owning them.
I've used that as my decision maker at times. Thus far it has worked.
MurrayM
Guru
Do you have a problem with China's political system?
Then it's time to liquidate your investments in Chinese companies.
To keep your Chinese investments is to support China's 'government'.
The irony of the following is not lost on me; someone I know who invested in China, who didn't give a hoot about pollution or workers rights there and was only concerned with return on his investments, is retiring soon and cannot travel the world as planned because of Covid-19.
Then it's time to liquidate your investments in Chinese companies.
To keep your Chinese investments is to support China's 'government'.
The irony of the following is not lost on me; someone I know who invested in China, who didn't give a hoot about pollution or workers rights there and was only concerned with return on his investments, is retiring soon and cannot travel the world as planned because of Covid-19.
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menzies
Guru
Do you have a problem with the US's Justice and Law Enforcement system - then maybe you shouldn't invest in US companies.
Or does it not work that way?
MurrayM
Guru
Good point.
MurrayM
Guru
MurrayM
Guru
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menzies
Guru
Teasing
China is somewhat different, being an authoritarian state, don't you think?
Nope, not at all, if you are basing your investment decisions on the actions of the country's government. Then you need to decide which governments you like and dislike and base your decisions on that.
Rebel112r
Guru
Did anybody that is in the market, not make money last week? Was a doozie for me. Currently holding, BA MMM DIS KO RDS TMUS MO and ZM. Expecting to give a little back next week. Keeping about 60% in cash for now. Good luck all. Wish I could get next weeks news in advance.
MurrayM
Guru
Certainly a factor to be considered. Hypothetically speaking, what sense would it make to invest in a weapons manufacturer who's government had missiles pointed at your country?
BruceK
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How do you invest in China? Isn`t pretty much everything ultimately state run? Certainly state regulated.
Who has investments in China? Certainly there are overseas companies manufacturing there. Is it totally DIY? Do they own land and factories built on the land? Can they function as they wish if the Govt for some reason, economic or political, at some point in time does not want them to? What is their security of tenure? How does it sit with China/US trade wars?
Lots of questions to answer. Wonder if B & B has business manufacturing in China.
menzies
Guru
Second week of July will be the next big test. The first quarter's reporting didn't really include much of the COVID impact. Once the second quarter numbers start rolling in we will see which way the rest of the year could go!
My guess, and only a guess, the market will be pretty flat until then, some up days, some down days.
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menzies
Guru
Good grief, no. There are many privately run listed companies - many listed in the US. This ain't your father's Communist Country!
Check out the Alibaba Group!
https://www.statista.com/statistics/299742/china-largest-public-companies-by-market-value/
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Our manufacturing is 100% in the US. However, we source materials from around the world and on our other businesses, which are retail, we do sell goods manufactured in China. The most obvious would by iPhones, but other items as well.
When operating a business, you have to decide who you'll deal with. We try our best to check out our suppliers, wherever they are. We do not choose based on the political agendas within the country. Now, as to sourcing from China, we've tried to minimize it but there are products that leave no other good options.
I also do not feel bad about purchasing products produced in China if in a decent factory setting. It provides work for people and people are not governments. They are individuals and the same wherever they are. That said, given the choice we like to go elsewhere. There are a few other countries we will not purchase products from.
We also do not export. We'd like to, but we feel the danger is too great, that our government might add a tariff and the foreign government will increase tariffs on our product, essentially stopping their imports. We don't want to get caught in a tariff war. As to tariffs on imports into the US, they just get passed on to the customer.
We also do choose not to use certain suppliers and sell to certain customers based on what we know about their treatment of employees and their ethics. On the other hand there are many we don't know about.
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I do. It's the best in the world. Who's Justice and Law Enforcement system would you rather live under? I can't think of a SINGLE country that does it better than the USA. We're far from perfect, but we're closer than anyone else IMO.
menzies
Guru
You "do" what?
First, Murray is Canadian.
And my point wasn't a comparison of systems. It was the fact that if you are going to apply that investment filter to China, then you need to apply it everywhere.
How do you feel about Saudi Arabia and other ME countries, Brazil and other LatAm countries, Vietnam, Russia. Are you investing directly or indirectly in their companies even if you disagree with their systems.
If you disagree with US systems do you not invest in US Companies? Remember this is a global forum.
That's the conversation here - not nationalism.
[and BTW, having lived with both I would say the UK's legal system and law enforcement system is WAY better that the US's. I will leave it up to those in other countries like Australia and New Zealand to chime in.]
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BruceK
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That`s great news. It doesn`t quite fit with the demonstrated ability of "China', be it all the free enterprise corporations you identify, or the CCP, in a global way,to reject Australian product and services previously purchased. I look forward to these numerous independent corporations making their own independent trade decisions based on quality and price. Any day now.
RT Firefly
Enigma
Greetings,
Mr. F. "I can't think of a SINGLE country that does it better than the USA." Here's 5.
https://nomadcapitalist.com/2017/04/30/best-countries-rule-of-law/
Mr. F. "I can't think of a SINGLE country that does it better than the USA." Here's 5.
https://nomadcapitalist.com/2017/04/30/best-countries-rule-of-law/
menzies
Guru
Which country do you believe allows that freedom on foreign imports?
menzies
Guru
You can download the report here:
https://worldjusticeproject.org/our-work/research-and-data/wjp-rule-law-index-2020
United States ranked 21st.
UK, 13th.
NZ 7th
Aussie 11th
Canada 9th
Back to Murray's point of not investing in China - they are 88th.
There are 128 countries in the list - that means 39 countries worse. Wonder how many companies from those countries are in mutual funds?
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MurrayM
Guru
The fellow I referenced in post #98 used to be a friend of mine, but we parted ways.
There were prior issues, but the two breaking points were regarding his quest for money. I was active against a mega dual pipeline and supertanker port proposal in our town, and he was all for it because he had invested in the company.
When I let him know that in cross examining the companies expert witness panel before the National Energy Boards Joint Review Panel, I got them to admit there was no way they could contain a full bore rupture near the headwaters of our river before it had reached the estuary. They also admitted they would set fire to the estuary because using heavy equipment to clean up the spill would be "too damaging to the environment". The river would also be "closed to fishing for at least four years."
He was born here, grew up here, and has been an avid fisherman all his life. His response was, "I will fish somewhere else".
The final straw was his going big on Chinese investments. We talked about human rights for a while, and when I suggested he might want to reflect back on the workers when he's sifting sand through his toes on Mediterranean beaches in retirement, that was it.
It's weird though...we could talk about anything before this, including me questioning aspects of his and many other religions and world views, but when it came to what I saw as his 'flexible moral compass' and money, our friendship ended.
There were prior issues, but the two breaking points were regarding his quest for money. I was active against a mega dual pipeline and supertanker port proposal in our town, and he was all for it because he had invested in the company.
When I let him know that in cross examining the companies expert witness panel before the National Energy Boards Joint Review Panel, I got them to admit there was no way they could contain a full bore rupture near the headwaters of our river before it had reached the estuary. They also admitted they would set fire to the estuary because using heavy equipment to clean up the spill would be "too damaging to the environment". The river would also be "closed to fishing for at least four years."
He was born here, grew up here, and has been an avid fisherman all his life. His response was, "I will fish somewhere else".
The final straw was his going big on Chinese investments. We talked about human rights for a while, and when I suggested he might want to reflect back on the workers when he's sifting sand through his toes on Mediterranean beaches in retirement, that was it.
It's weird though...we could talk about anything before this, including me questioning aspects of his and many other religions and world views, but when it came to what I saw as his 'flexible moral compass' and money, our friendship ended.
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MurrayM
Guru
Gulp. Here we go again?
Other dodgy shenanigans in article.
https://www.theatlantic.com/magazine/archive/2020/07/coronavirus-banks-collapse/612247/
Other dodgy shenanigans in article.
https://www.theatlantic.com/magazine/archive/2020/07/coronavirus-banks-collapse/612247/
RT Firefly
Enigma
Greetings,
Mr. MM. There is something morally wrong with a system that allows thousands or perhaps tens of thousands of people to lose their life's savings for the profit of a few with absolutely no meaningful penalty to said few. I'm thinking Goldman-Sachs here.
Mr. MM. There is something morally wrong with a system that allows thousands or perhaps tens of thousands of people to lose their life's savings for the profit of a few with absolutely no meaningful penalty to said few. I'm thinking Goldman-Sachs here.
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