Weekly Market Wrap

I was telling my wife Janet yesterday that this Friday would be the real tale of the tape about a stock market rally. If the markets ended up on Friday, it would be a positive sign of investor confidence and we could be onto something. If they ended down, investors still aren't convinced that we're out of the woods just yet.

While this past week brought some good news regarding new home sales, consumer spending and corporate earnings, rising unemployment news still has many investors too nervous to remain in the markets. So, it looks like we'll have to see what next week brings.


Source: ajc.com|Mike Luckovich

In the meantime, knowing that a picture (or cartoon) is worth a thousand words, I thought I would post a linkfest to some of the very best financial editorial cartoons that I found this past week.

Gary Varvel - The Indianapolis Star

Jim Morin - The Miami Herald

Clay Bennett - Chattanooga Times Free Press

Steve Breen - San Diego Union-Tribune

David Horsey - Seattle Post-Intelligencer

Don Asmussen - San Francisco Chronicle

Enjoy the weekend!

In Search of a Deal - Step 1: Grow a Pair

So last thursday I get a call from my old college roommate, not Grant but my other roomy.  He had tickets to NCAA first round tournament of games in KC.  So I called up my pops and off we went to the Power and Light District by the Sprint Center.  A good time was had by all, including such great quotes as:

"There is no one in OU's band that could even play the cow bell in the Morgan State Band!"

"Air ball, Air ball, Air ball"<-directed at Blake Griffin after missing a free throw

"Mr. D, you are going to let your son use that OU rally towel?" and the reply "He said he needed a rag for wiping his feet and changing oil"

"Well should we play Boomer Sooner again?" <- in response to Morgan State's band director taunting OU's band.

Needless to say Morgan State has one heck of a pep band.  Elsewhere, I was trying to teach my old roommate a lesson in economics.  See he bought the first round ticket set before the seeding occurred and paid out the nose for them.  A couple of people backed out and he was stuck with the tickets.  My dad and I helped with a couple of tickets, but who knows how bad he loss with the rest of the sessions.

Regardless, I am a firm believer in ticket scalping.  Put on your school affiliation gear and walk out to the stadium.  Every time I have ever gone to a Big 12 tourney or first round session, I have paid no more than a $30 ticket to get in.  Usually paying $10-$20.  Why you say?  Because when I was young a good friend of my pappy taught me the art of buying tickets.  There are more stories than advice here but the basics are don't be a wuss and grow a pair.  For those who are unable to do this, bring a friend that has.

The biggest part of getting a good deal on anything is having the guts to try.  Everyone from that guy who yells at you on TV to Trump has opinions on how to do it, but I always thought it was best to try anyway you can and after a few tries and some good awareness you should be well on your way.

Tour de Broke - Not coming to a town near you, unless you live in Boulder

Well, my GF has outdone herself this time. She convinced now in the time of my dire straits that I should get out of the house and travel to go see my brother. I told her the whole when you have work you don't have the time for a vacation and when you don't have work you have the time but can't afford the trip. Well she 86'd that idea and out the door I was pushed on Wednesday. I love that gal. 9.5 hours of driving later I am in beautiful Colorado with my brother, sister-in-law, and my two favorite nieces hanging all over me. It just recharges the batteries a little. My job search needs a search party currently since I have only heard from one recruiter for an out of town contract engineering job. He won't call me back either now.

It is rough out there, but at least the unemployment money is coming in with it's +$25 (thanks Jesus II) and I am not dipping into any savings so far. At the risk of becoming a statistic, I am going to take advantage of this time to try and get that mortgage rate down (not that it is that high). Then see what I can do out there, my two positions that I am most qualified for aren't exactly in the best shape right now. Do you know any non-producing factories that need a manufacturing engineer or any underwater businesses that are in need of a capital projects manager? All joking aside, it is going to be interesting to see what I end up doing. For right now, I have to go read my youngest niece a book. Hope the rest of you are enjoying your work.

Comments as true now as they were then...

Here is the famous part from the movie Network. I recently heard this quote over the radio again and it is as true now as it was then.

Mad As Hell
Uploaded by terzieview

I agree, I want you to get mad, get mad as hell...god dammit my life has value!

(Quick note, congrats Mike on the new job. AND if you haven't visited in awhile this site is now authored by myself and Mr. Guzzo. Ain't technology grand!)

It's All About Patience

There's an old Dutch saying: “A handful of patience is worth more than a bushel of brains.”

After three months of searching and waiting for "the right" job, I've finally found the ideal position that I was looking for. With a pharmacist shortage nationwide, it used to be easy to pick and choose what I wanted to do. But now that we're in a recession, finding that "ideal" job isn't so easy. Yeah.. I know. Boo Hoo.

In order to demonstrate just how difficult it is finding a "good" job nowadays, I thought it might help others if I videotaped my most recent job interviews so you could see for yourselves.

To begin with, I wasn't offered the first job for which I interviewed. The HR person interviewing me with must have missed his morning coffee. It was all over within the first minute after he found out my GPA in college. Hit me with a brick, why dontcha.

So, I shook it off, reworked my resume a little, and set forth on my second job interview. This one seemed to go a little better. I thought that I convinced them that I was the best man for the job. The interviewer seemed interested in hiring me, but decided it would be best to consult with his superior first. Once his boss came into the room though, it was all over and I was shown the door. Tough crowd.

I realized that I must be doing something wrong, so I decided to ask a colleague if I needed to rework my interviewing methods. I took his advice to heart, changed my entire approach, and set off on my third job interview.

Not only is patience worth more than a bushel of brains, but sometimes it's nice having more luck than brains.

I'm not exactly sure what happened. Maybe it was my new haircut, the way I dressed, or maybe even the way I carried myself, but this interview went far better than I could have expected. This employer hired me on the spot and gave me everything that I wanted. I was so happy that I spent the whole night celebrating with my beautiful wife.

Now, let's see if having patience will work out with my investments.

Hold on Tight

We've officially been in a recession for 15 months now and it looks like we're about to break the record for the longest recessionary period since the Great Depression. With rising unemployment, record foreclosures, and depleted savings, this economic crisis is almost crushing our dreams for a secure retirement.

But, hold on tight, don't give up just yet.

After the Treasury Department's announcement today of their plan to rid banks of bad debt, investor confidence surged. The markets rallied with renewed confidence that our new administration will do it's best to keep our financial system from failure. Hopefully, the Fed's actions will spark a permanent turnaround.

However, what's really on everyone's mind is: Have we reached a market-bottom or is this just a bear market rally? Of course, everyone has their opinions pro or con, but we'll only actually know in hindsight.

Like everyone else, I have my own opinions. But, I thought I would ask a few old friends if they could orchestrate a get-together in order to shed some electric light on the subject.

Here's what they told me:

Accroches-toi a ton reve
Accroches-toi a ton reve
Quand tu vois ton bateau partir
Quand tu sents -- ton coeur se briser
Accroches-toi a ton reve.

Sounds like good advice to me. If you can't read French, watch this video for a better understanding.

A Liter For The Fallen...

One of my favorite bloggers, Mr. Mike Guzzo of Guzzo the Contrarian fame has closed his site down for good after a few months of conflicting thoughts on continuing. This stinks from my opinion, but I was able to convince him that whenever he feels the need to share again with the world, he can do so whenever he wants here at Dyslexic Research. I truly respected his work, and he even influenced my own investment strategy toward more stable 'Bogle' style, low fee, diversified investing. His website will be missed, but hopefully he won't be as I am planning on giving him the ability to write what he likes when he is ready again.

So another one doesn't quite bite the dust and I will drink a liter to that (it's a Filipino beer thing).

Don't Believe the Hype, But...

So after the market has increased in value now for roughly 6 days, a lot of naysayers are starting to come around and say that we "may have hit the bottom". People are looking for more signs than a group of fourteen year old girls in an Ouija board. I don't believe the hype, until my friends at the paint company tell me that production is up, I am going to have a hard time believing it. There is just too many people on unemployment, too many scared to purchase more than anything besides the necessities. I won't believe it until consumer spending is up for a couple of quarters.

BUT,

The savvy investor, the contrarian, and myself know (I am the dumbest of the three) that if you wait too long you may miss the bounce. So I have begun the search for more good stocks. It is a gamble, no doubt. I have two ultimate criterion. 1] The potential company must be one that will exist when this economy has finally turned. 2] The potential company must be one that will be profitable when this economy has finally turned. Sorry GM doesn't qualify.

My favorite way to begin a stock search is through the magic formula screen. I have talked about it before, recommended buying the book, and believe in it's methodology. I won't go into full on stock research in this post, but will say that my findings turned up several good prospects including: CALM, MLHR, MSFT, PCU, PM, RIMM. Until I plow through their latest financials I won't recommend anything. Also there are a few perennial industrial powerhouse stocks that are 'relatively' cheap including LECO and EMR among others.

I will start doing the numbers because I am beginning to feel like it is a good time to start looking to buy. We will see how it goes.

How to Become a Financial Expert...

Step One: Create a blog.

Step Two: Create content, typically cover crap any investor already knows or something popular spewd out by whatever current financial or investing expert that everyone knows. Topics like "Save 25% of Your Income" and "How to Start a Roth IRA" are good starters (if your new go ahead use these topics, I don't mind). Keep those things like thoughts and ideas of your own at bay, don't want to go ruining your content.

Step Three: Add stupid clip art.

Step Four: Answer comments by the finacially inept.

Bam, instant success. In no time you should be well on your way to financial superiorism.

(Maybe that is why I only have two viewers, thanks Grant and Mike ahead of time)

Due to tough economic times...

...we may have to lay off Andre.

If you have money left, where would you invest?

So if you have money, and want to actually invest in something still what would you do?

Before I answer that, let me just say that my parents grewup as children of parents that survived the Great Depression and the Dust Bowl of Oklahoma and as adults themselves survived the exodus of jobs in Oklahoma when all of the Oil Companies left the state in the 80's. They never have really invested other than, their home, some rental properties, and high interest CD's and Money Market accounts. They have saved some, but I am uncomfortable to think how much. Their current jobs are secure and they are close to retirement. I know that my brother and I wish they invested more, but now think at times maybe they might have been fairly right all along. I mean they have seen some of these economic times on a micro-economic level in Oklahoma and experienced the psychology of their parents in the aftermath of the Great Depression, and learned what is really true: money and stuff you own, and real estate.

Which gets me back to where do you invest in this market, that will have the best chance of returning a profit in the years to come? Me, I am leaning towards real estate. I know it is crazy, but prices are at a value and if you truly know your town, and make logical property purchases over the long term you could really do well. Nothing is a guarantee, but if you are truly a long term investor, it may be just the right way to go.

Thoughts???

An Idea...(Notice: Rant Ahead)

Recently between working on my neighbor's house for money, wading through unemployment proceedings, attempting to refinance, signing up for COBRA, and oh yeah looking for a job, I am noticing a few trends:

1. Everyone has their own idea of what will get us out of this mess.
2. No sympathy for where public America is really at right now.
3. The ridiculousness of the comments I have been hearing on radio and TV.

So 1, all over the radio and TV is a number of people stating that their own idea of what will boost the economy, and the truth of the matter is that they need to take care of their own house, their own job, and their own money. By trusting some other jack@$$ in the first place, buying crap you don't need, and banking on rapid growth or some other prospective investment we have all fallen into a trap. We used 'fake' money, overspent on ridiculous stuff, and now want someone to help the sinking ship we all created. Somewhere in life, things went from buy what you can afford to buy now pay later, even if you can't. Stimulus plan may work, may not, but if we all start coming to the epiphany of what we can really afford then maybe we will stop the scariness of everything. End overbuilding, overspending, and think. In the past two years I bought a new 'used' car and a house. I put down more than 10% on each, purchased something extremely affordable, and they may both be in jeopardy now that I don't have a job. Okay not really, but they could if I am unemployed a year from now. I take that responsibility however, and it is my job to try and take care of things.

2 is the other common theme I hear. Please understand we are past the point of the housing bubble, that was a domino, and now a lot of people, more than what is being reported, have lost their jobs or may end up losing their jobs. Sure idiot bankers should not have sold 0% down loans to risky buyers and likewise buyers should not have thought that they could purchase these homes, blah blah blah, etc. Spending is frozen, lending is frozen, and no body is really producing anything besides gas, food, energy, and natural gas. A quick call to friends from past employers over the past two weeks report 20%-30% work force layoffs at every employer I have ever worked for, ALL OF THEM. To top that off everyone of them is producing at around 10% production of their yearly average. TEN PERCENT!!! Read that as factories, companies, employees, everyone is standing on that cliff looking over the edge. Unless something changes, i.e. lending opens up, people open up their pocketbooks, then bankruptcy and shutdowns at the least are going to begin to occur. It is going to be painful, heck it is painful. Start showing some sympathy for your fellow man, because you may be next one on the chopping block, and hope your neighbor isn't serving crow when you need help with your next meal.

And last but not least number 3. The bits of armor are starting to fall off of everyone, and we are hearing some of the most stupid comments I have ever heard from people getting worried. For example, today on NPR's Talk of the Nation, a gentlemen called in to the station to say that it has been very difficult to get his two VARIABLE RATE HOME LOANS on his current home and his VACATION HOME, and although he has hired someone to help him get them readjusted nothing has occurred. He wanted to know when the government was going to force these banks to do something. All I can say is, where is this guy and how else can someone make money off him. Then about a month ago NPR covered the fact that California may default on their bonds for the first time ever, a consequence was that student loan checks have been late, not that they weren't paid out, just late. NPR of course found some strapping young woman at Berkeley for comment. Her quote you ask? "It's not bad enough that I am a DOUBLE MAJOR with a MINOR, but now I am going have GET A JOB to make my payments." I don't know where to begin, first college is a privilege, second 2 majors and a minor what the heck do you need that much college for, third enjoy your debt for the next 25 years, and lastly YES YOU MAY HAVE TO GET A JOB.

These times are rough, and I am sorry if I am negative. The government is doing some positive things, albeit expensive things, to try and help. I will be one of the people in line for the help, and will remember this if I make it through this intact and reciprocate to someone else in need.

Good luck, evaluate yourself, and SAVE!