Friday, October 27, 2017

Portfolio “Update”

I sold all of my MAT (Mattel) and took a small position in M (Macy’s). Ordered by largest position to smallest.....

PG (Procter & Gamble)
PEP (PepsiCo)
WBA (Walgreen Boots Alliance)
MMM (3M)
GPC (Genuine Parts Company)
VZ (Verizon)
IBM (International Business Machines)
T (AT&T)
KO (Coca Cola)
ADP (Automatic Data Processing)
HAS (Hasbro)
KMB (Kimberly Clark)
GIS (General Mills)
HPQ (Hewlett-Packard)
SYY (Sysco)
K (Kellogg)
DPS (Dr. Pepper Snapple)
M (Macy’s)

This portfolio represents about 25% of my assets, about 15% is a home mortgage, about 2% precious metals and collectibles, and the rest are CDs.

Saturday, October 07, 2017

The Next Economic Collapse

Since the Great Recession ended 11 years ago and the US is near full employment, odds are that we are due for at least a recession in the not too distant future. And since US financial markets are at or near all time highs, even a mild recession could hit our financial system pretty hard, depending on the triggering event or events.

Anyway, I'll list some potential triggering events which I see could happen.

1. China's debt situation begins unraveling. Debt over 2x GDP, ghost cities and China's apparent policy of buying up commodities for future use.
2. Climate Change. Hurricanes and wildfires are already stretching resources.
3. War. Recent vitriol makes war with North Korea or Iran a real possibility.
4. Rising US interest rates. Rates are already rising.
5. US debt. Not just national debt, but stock and bond margin debt, auto debt, student loan debt and mortgage debt.
6. Underfunded pensions. State, municipal and corporate.

Tuesday, July 04, 2017

My Review of "Prosperity Without Growth:Foundations For The Economy Of Tomorrow"

5 out of 5 stars

What struck me as very consequential in the book, by Tim Jackson, is that in the two decades in Japan of low growth following good growth during the previous decades, life expectancy grew nicely.

Thus, the question the book explores, is GDP growth necessary for prosperity? It all depends on how one measures prosperity. Jackson says there should be a Subjective Well-Being measurement, kind of a middle ground measurement between a totally consumer material goods and totally socially oriented economy. Poorer societies do need more consumption to achieve basic human needs of hunger, shelter, etc, but having achieved those basic needs for most of its people, societies need less consumer goods consumption and more services - all together maybe of lesser monetary economic value.

The book does look at the 2008 financial crash and how it brought the world closer together, as needed, since one of the causes of the crash had been less economic coordination.

Bottom line, the book is excellent in showing GDP growth numbers, alone, can be very misleading in measuring prosperity. I recommend the book......
#Amazon

Thursday, May 11, 2017

Portfolio "Update"

I sold my CAT, CDK and HYH (CDK and HYH were spinoffs from ADP and KMB), while adding some IBM and GIS, basically to narrow down the number of stocks in my portfolio and focus better on my dividend growers. The portfolio is ordered by largest position to smallest....

 WBA (Walgreen Boots Alliance)
 PG (Procter and Gamble)
PEP (PepsiCo)
HAS (Hasbro)
MMM (3M)
T (AT&T
GPC (Genuine Parts)
VZ (Verizon)
KO (Coca Cola
MAT (Mattel)
ADP (Automatic Data Processing)
KMB (Kimberly Clark)
IBM (International Business Machines)
GIS (General Mills)
K (Kellogg)
HPQ (Hewlett-Packard)
SYY (Sysco)
DPS (Dr. Pepper Snapple)
6% GNMA (Government National Mortgage Association) Bonds

This portfolio represents about 30% of my assets, about 15% is a home mortgage, about 2% precious metals and collectibles, and the rest are CDs.

Saturday, March 18, 2017

My Review of "Automatic Society"

Worthy subject, bad thinking....

2 out of 5 stars

The author looks at how work has been de-humanized to the point of being just part of a society structured around, as he calls it, computational capitalism, a system where consumer consumption is the measure of success. And, we are ruled by "algorithmic govermentality."

Sure, automation has lead to less needed human work hours, and there is dignity to hard work, be it manual or intellectual. But, this is the way progress happens. The world is the healthiest (longest life expectancy), most educated, etc. By the way, video games require higher order thinking than reading (parallel vs sequential thinking). Not that one replaces the other, just that most everyone's brain is more capable of the creative and critical thinking the author thinks has been lost.

Bottom line, I think this book is misguided AND masked with words so pedantic, one needs a dictionary to read almost every page.

Wednesday, March 08, 2017

Portfolio "Update"

I sold my Chevron (CVX) and added General Mills (GIS). My portfolio, ordered by largest position to smallest....

WBA (Walgreen)
PG (Procter and Gamble)
PEP (PepsiCo)
HAS (Hasbro)
GPC (Genuine Parts)
MMM (3M)
T (AT&T
VZ (Verizon)
MAT (Mattel)
KO (Coca Cola)
ADP (Automatic Data Processing)
KMB (Kimberly Clark)
K (Kellogg)
IBM (International Business Machines)
SYY (Sysco)
HPQ (Hewlett-Packard)
CAT (Caterpillar)
DPS (Dr. Pepper Snapple)
CDK (CDK Global)
GIS (General Mills)
HYH (Halyard Health)
6% GNMA (Government National Mortgage Association) Bonds

This portfolio represenents about 25% of my assets, about 16% is a home mortgage, about 3% precious metals and collectibles, and the rest are CDs.





Sunday, January 22, 2017

The New Economy

As a new president begins handling the economy, my take on where we stand now....

The US stock, bond and RE markets are near all time record highs, with low inflation, and about 8 years of economic expansion and the world's best economy at nearly full employment. Most importantly, this has been achieved through great innovation - the Cloud, Big Data, Mobility, Robotics, the Energy Revolution, etc. And, geopolitically, a minor amount of American casualties. Thus, a solid economy.

Unfinished business, so to speak, is large income inequality and a high number of underemployed workers. Plus, about $20T of national debt.

As it looks now, the new president offers reduced corporate income taxes including repatriation of foreign income, reduced personal income taxes, reduced corporate regulations, an infrastructure program, a protectionist trade policy, a restrictive immigration policy, repealing/replacing ACA, and cutting federal programs except the military

With nearly full employment and a proposed restrictive immigration policy, there will likely be a shortage of workers for any large, new infrastructure program. Already there is a shortage of low end agricultural and construction workers. It seems the biggest need for whatever slack there is in our workforce is for retraining many for the new, more technology advanced economy. Thus, no short term benefit can be expected from such a new infrastructure program. Plus, with our aging demographics, we should be facilitating greater immigration and legalizing not deporting illegal residents. On top of that, repealing/replacing ACA could throw our healthcare workforce, an important part of our growing workforce, into disarray. So, overall, a questionable worker program.

In conclusion, tax cuts and less regulation would likely stimulate the economy short term, but longer term, they are of questionable worth since there is no certainty how long or how much our economy can expand until the next recession, plus with such a large national debt, we are in terrible shape to handle the next recession. So, seems with a healthy economy, instead of continuing our slow and steady progress, we are introducing massive uncertainty, not to mention a major expected foreign policy reset.