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Thread: Dow hit 13,000 today

  1. #61
    [QUOTE=palmetto defender;4378733][QUOTE=Black Death;4378115]Pointed out to me today that US stockmarket performance is not only skewed by the actions of the US Fed, but also by the outstanding company, Apple, which makes up 4% of the Dow and 17% of the Nasdaq. Apparently also bigger than the entire US manufacturing sector in terms of $ value.[/Qine compqaUOTE]

    Don't mean to be too pedantic here, but Apple is not part of the Dow. It is not now nor has ever been a component. There is no questioning it is a fine company but market value is not everything. Plus with Jobs gone ??[/QUOTE]

    You are right - should make clear that [I][B]if[/B][/I] Apple were part of the Dow it would be roughly worth 4% of the index in terms of $ value.

    One of the side-effects of Fed policy is that there are no returns to be had in traditional savings accounts so anyone looking to park their money somewhere has to put it in a riskier place, hence money flowing into US stock markets. Let alone the carry trade low interest rates engenders. Low interest rates are an extremely short sighted policy that over time does much more harm than good. High oil and gas prices and high commodity prices in general can also be traced to low interest rates as can the housing bubble that led to the GFC.

  2. #62
    [QUOTE=Trades;4378770]Is it? Really? I thought it was to set the boundaries and norms of our society to weed out the behaviors that could be dangerous and/or infringe upon the freedoms of the citizens of our country.[/QUOTE]

    Isn't setting boundries based on norms an infringement of freedom of citizens?

    Laws are clearly meant to either impede freedom when that freedom is dangerous to others or create behavior that society deems in it's interest. An interest that will change as society changes.

  3. #63
    [QUOTE=Black Death;4378940][QUOTE=palmetto defender;4378733]

    You are right - should make clear that [I][B]if[/B][/I] Apple were part of the Dow it would be roughly worth 4% of the index in terms of $ value.

    One of the side-effects of Fed policy is that there are no returns to be had in traditional savings accounts so anyone looking to park their money somewhere has to put it in a riskier place, hence money flowing into US stock markets. Let alone the carry trade low interest rates engenders. Low interest rates are an extremely short sighted policy that over time does much more harm than good. High oil and gas prices and high commodity prices in general can also be traced to low interest rates as can the housing bubble that led to the GFC.[/QUOTE]


    Again, there are only 30 stocks in the Dow, so averagely each is worth 3.3% of the index. Apple is fine, but as far as contribution in $ and employment it's the Exxons and Walmarts that matter.
    As far as risk, I personally (and each of us has different plans) have 3 times as much money in bonds as I do in stocks. Safe and a solid dividend. Not much growth but mucho cash.

  4. #64
    [QUOTE=palmetto defender;4379504][QUOTE=Black Death;4378940]


    Again, there are only 30 stocks in the Dow, so averagely each is worth 3.3% of the index. Apple is fine, but as far as contribution in $ and employment it's the Exxons and Walmarts that matter.
    As far as risk, I personally (and each of us has different plans) have 3 times as much money in bonds as I do in stocks. Safe and a solid dividend. Not much growth but mucho cash.[/QUOTE]

    I think you'll be missing the boat as sharemarkets will continue to rise and inflation be a problem (affecting "solid" investments) while printing presses are running wild.

    Just on that surprised not much of a mention here of shale gas - which is going to be a much bigger game changer for the US economy than anything Apple can come up with. The USA destined to be a net exporter of energy as a result.

    I've just invested heavily in a mining services stock as they are getting all the benefits of the resources boom but with much less risk, but 'hot' sectors like shale gas pop up every year and there is money to be made when they do.

  5. #65
    Low interest rates also mean rates on the National Debt are lower. In another area Freddie and Fannie are buying allot loans from banks. We keep on doing the same mistakes over and over again.

  6. #66
    [QUOTE=Black Death;4378940][QUOTE=palmetto defender;4378733]

    You are right - should make clear that [I][B]if[/B][/I] Apple were part of the Dow it would be roughly worth 4% of the index in terms of $ value.

    One of the side-effects of Fed policy is that there are no returns to be had in traditional savings accounts so anyone looking to park their money somewhere has to put it in a riskier place, hence money flowing into US stock markets. Let alone the carry trade low interest rates engenders. Low interest rates are an extremely short sighted policy that over time does much more harm than good. High oil and gas prices and high commodity prices in general can also be traced to low interest rates as can the housing bubble that led to the GFC.[/QUOTE]

    Low interest rates are simply a relection of loan demand. The Fed is reacting to market conditions.

    Why should banks give high interest to attract deposits when they don't have loan demand?

  7. #67
    [QUOTE=Black Death;4380482][QUOTE=palmetto defender;4379504]

    I think you'll be missing the boat as sharemarkets will continue to rise and inflation be a problem (affecting "solid" investments) while printing presses are running wild.

    Just on that surprised not much of a mention here of shale gas - which is going to be a much bigger game changer for the US economy than anything Apple can come up with. The USA destined to be a net exporter of energy as a result.

    I've just invested heavily in a mining services stock as they are getting all the benefits of the resources boom but with much less risk, but 'hot' sectors like shale gas pop up every year and there is money to be made when they do.[/QUOTE]


    Not a big fan of the shale concept - at least in any sort of near term.
    My father bought into a large shale company - TOSCO - almost 40 years ago. He's long since dead. Never a return. The U.S. will be a long time coming before we are a net exporter.
    BTW, I don't miss the boat on much. Between my broker and me we do ok. First 8 weeks + $270K. Love buy and hold. Have some stuff my father bought me for getting a scholarship. Some are worth well over 100times their cost. Have to be patient with good stuff.
    Relative to Apple - US Steel was big once. Same KMart, Woolworth, Singer, Lehman and lots of others.

  8. #68
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    [QUOTE=palmetto defender;4380894][QUOTE=Black Death;4380482]


    Not a big fan of the shale concept - at least in any sort of near term.
    My father bought into a large shale company - TOSCO - almost 40 years ago. He's long since dead. Never a return. The U.S. will be a long time coming before we are a net exporter.
    BTW, I don't miss the boat on much. Between my broker and me we do ok. First 8 weeks + $270K. Love buy and hold. Have some stuff my father bought me for getting a scholarship. Some are worth well over 100times their cost. Have to be patient with good stuff.
    Relative to Apple - US Steel was big once. Same KMart, Woolworth, Singer, Lehman and lots of others.[/QUOTE]

    Have any good tips? lol I have made some decent money on iRobot and Cummins recently.

  9. #69
    [QUOTE=Winstonbiggs;4380663][QUOTE=Black Death;4378940]

    Low interest rates are simply a relection of loan demand. The Fed is reacting to market conditions.

    Why should banks give high interest to attract deposits when they don't have loan demand?[/QUOTE]

    Interest rates are set centrally by the Fed in the US? That was my understanding? Low interest rates are basically a reflection of Fed policy *not* of supply and demand - low interest rates encourages people to *not* put their money in savings accounts and chase 'hot' sectors like sharemarkets etc. Namely it encourages vapid speculation at the expense of 'real' investment - it also causes inflation issues as it devalues the currency and the carry trade it engenders shovels cash into areas like gold/oil etc pushing up those prices.

    There is no loan demand because basically most Americans are hocked to the hilt - your economy has to undergo a massive delevering process before it can truly recover. The Fed has set interest rates low in order to stimulate your economy - but as we saw when interest rates were set low after 9/11 that can have horrendous unintended consequences, namely the housing bubble and subsequent crash that sparked the Global Financial Crisis.

  10. #70
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    [QUOTE=Trades;4380955][QUOTE=palmetto defender;4380894]

    Have any good tips? lol I have made some decent money on iRobot and Cummins recently.[/QUOTE]

    Plastics..... thats the future. I saw it in a movie.;)

  11. #71
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    The last 5 posters here, pontificating about investments, couldn't even get the brackets right on their quote posts.

    No thanks. I'll take my investment advice from a Gypsy machine.

    Step up your game, people!! :P:D

  12. #72
    [QUOTE=Trades;4380955][QUOTE=palmetto defender;4380894]

    Have any good tips? lol I have made some decent money on iRobot and Cummins recently.[/QUOTE]


    Your strategy is going to be different from mine. I am older and have a different time frame.
    I once took some risk when I was young. Was fairly successful with stocks. Late 30s switched to only buying bond funds - high yield and munis. Then mid 50s took all the income from those dividends and returned to buying stocks. In my entire life, I have never taken a dime of principal out of any of my accounts. That is the long term secret.
    I now only buy quality stocks that pay a decent dividend - around 3% or more. PLus I don't buy anything I don't understand.
    I accumulate. Have not sold a stock in 10 years.
    Not a believer in stock/equity funds. Too many fees detract from return.
    BTW, never owned Apple or Google. Remember, before Google the big deal was Yahoo. That's where? As for Apple, pretty solid but so was Microsoft which has laid there for 12 years now. Gates went=stock down. Jobs dead=???

  13. #73
    [QUOTE=PlumberKhan;4381252]The last 5 posters here, pontificating about investments, couldn't even get the brackets right on their quote posts.

    No thanks. I'll take my investment advice from a Gypsy machine.

    Step up your game, people!! :P:D[/QUOTE]

    I was one of the last 5 posters and did NOT make a mistake.
    Investment advice? Never give it specifically. Don't have a license as a broker, so not risking getting called out by one of the resident self righteous libs here.

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