Author: Flynn

FINRA is the Financial Industry Regulatory Authority which licenses individuals and firms who provide investment management. Fidelity has decided that the power of attorney they require which allows me to make investments for about 10 investors is not valid since I am not a FINRA members – it took them 23 minutes as I was on hold to figure this out and when they told me why, they also asked me if I was a FINRA member. This is a great time for Fidelity to do this since every account I manage is all in cash (since Fidelity makes no money on cash, that could also have influenced their decision). If you never make a trade, you will not lose any money (and never make any). Years ago I considered registering (it was a pain) with the NASD (predecessor to FINRA) as an investment adviser because at the time NASD would sue investment letters writers unless they were registered. The result of the several law suits was that NASD did not have the power to limit free speech and registration was no long required.

Jim Rogers is Short the NASDAQ Composite Via ProShares UltraShort QQQ (ETF). http://www.midasletter.com/2016/02/jim-rogers-on-shorting-the-nasdaq-composite-via/

Doug Fabian in his weekly podcast suggested that EMQQ and ECON were two ETFs to watch when the market starts going up. These ETFs focus on emerging markets where the middle class is growing rather than developed markets (US, Japan, China, Europe) where the middle class is declining.
A look at my list of top 20 funds shows that GovernmentCashReserves is #13. When a fund which never goes up or down and is only paying 0.01% is one of the top 20 funds of the 130
funds I follow, it is not a time to buy.

IBD TBP’s Market Pulse is “Confirmed Uptrend ” as of 02/17/16. Most of the time it would be a time to buy, but with GovernmentCashReserves still in the top 20 funds it is not a time
to buy.

My current investments:
IRA#1 and IRA#2
GovernmentCashReserves
IRA#2
GovernmentCashReserves

My portfolio changes this weekend:
IRA #1 – None
IRA #2 – None

My portfolio market exposure after this weekend’s changes:
IRA #1 – 00% invested
IRA #2 – 00% invested

A look at my list of top 20 funds shows that GovernmentCashReserves is #07. When a fund which never goes up or down and is only paying 0.01% is one of the top 20 funds of the 130 funds I follow, there are very few funds to buy.

IBD TBP’s Market Pulse is “Confirmed Uptrend ” as of 02/17/16. Not a time to buy yet since I want to wait a week to see it the trend changes. Bear markets generally have a couple of weeks of good uptrends until the correction starts again. IBD is rather positive that perhaps this time the confirmed uptrend will last.

My current investments:
IRA#1 and IRA#2
GovernmentCashReserves
IRA#2
GovernmentCashReserves

My portfolio changes this weekend:
IRA #1 – None
IRA #2 – None

My portfolio market exposure after this weekend’s changes:
IRA #1 – 00% invested
IRA #2 – 00% invested

Central Banks have Lost Control of Markets, 2016 Will Not be Good – Jim Rogers Interview https://www.youtube.com/watch?v=K8sW5CHfwfQ

I try to listen to Gary Kaltbaum’s radio show every evening or later on a podcast. Starting last last year he suggested the up market was ending and so far he seems to be correct. You can read an interview with him at http://www.breitbart.com/big-government/2016/02/07/gary-kaltbaum-on-breitbart-news-radio-markets-are-crashing-as-fiscal-steroids-wear-off/

On Jim Lange’s podcast, #160 New Social Security Law Changes, he discusses what you need to do if you are eligible for Social Security before 01May16. At his web site, paytaxeslater.com, you can sign up for a free report on the Social Security Law changes. One of his comments was that if you need to take Social Security before full retirement age,
you cannot retire.

The latest podcast #532 from Dorsey Wright & Associates  (who developed the method used by DWTR and the 9 ETFs in which it invests) speculated on the probability that cash could be included in the DWTR’s portfolio. It seems cash may have better performance than the other 9 ETFs when DWTR changes it’s portfolio at the end of the month.

IBD TBP’s Market Pulse is “Market in correcction” as of 02/08/16. Not a time to buy. The market has a reputation for predicting the future. I just wonder exactly what sort of problem it is predicting today – major bank failures, a recession, a depression, the election?

My current investments:
IRA#1 and IRA#2
GovernmentCashReserves
IRA#2
GovernmentCashReserves

My portfolio changes this weekend:
IRA #1 – None
IRA #2 – None

My portfolio market exposure after this weekend’s changes:
IRA #1 – 00% invested
IRA #2 – 00% invested

On Jim Lange’s podcast, #160 New Social Security Law Changes, he discusses what you need to do if you are eligible for Social Security before 01May16. At his web site, paytaxeslater.com, you can sign up for a free report on the Social Security Law changes. One of his comments was that if you need to take Social Security before full retirement age, you cannot retire.

I have not found any detailed news on FV and DWTR, but both these ETFs changed their portfolio recently. These ETFs are momentum managed ETFs which purchase other ETFs. Each of them eliminated a health related ETF and replaced it with a utility ETF. This is a move to more defensive investments. I’ve owned both and in both cases were stopped out.

For my latest 4 purchases for IRA#2 (which were sold last month) I also purchased corresponding ETFs in another portfolio. ETFs were sold with a stop loss of 7% below the highest daily close. The funds were sold any time the weekly close was 5% below a previous weekly close. All the investments lost money but the ETFs lost less.
SRetailing FSPRX lost 7.64%. ETF – XLY lost 2.72%.
SSoftware&ComputerServices FSCSX lost 9.85%. ETF – MTK lost 5.54%.
SConsumerDiscretionary FSCPX lost 11.07%. ETF – FDIS lost 8.51%.
STechnology FXPTX lost 12.29%. ETF – IGM lost 6.81%

IBD TBP’s Market Pulse is “Uptrend under pressure” as of 02/05/16. Not a time to buy. It lasted as an “Uptrend” for 7 days. not a sign of a bull market.
On Wednesday, the Federal Reserve Board (FRB) member Dudley expressed concern about the FRB’s plan to increase interest rates. Finguring perhaps the FRB may losen interest rates, the market went up modestly for two days and the decided to ignore his statements. The impact of the FRB is less and less.

My current investments:
IRA#1 and IRA#2
GovernmentCashReserves

My portfolio changes this weekend:
IRA #1 – None
IRA #2 – None

My portfolio market exposure after this weekend’s changes:
IRA #1 – 00% invested
IRA #2 – 00% invested

Returns for the month of December were negative.
In December IRA#1 -2%, IRA#2 -2%, PDP PIE PIZ DWAS -4%, QQQ -1%, SPY/RSP -3%, DWTR -3%.
For the last 3 months, IRA#1 -2%, IRS#2 -2%, PDPetc -0%, QQQ 3%, SPY/RSP -6%, DWTR -2%.
December portfolio changes:
IRA#1 – None
IRA#2 – Sold FBSOX 12/21
PDP PIE PIX DWAS – Sold DWAS 12/14
QQQ – Sold QQQ 12/04
SPY/RSP – Sold SPY 12/14
DWTR – None
All sales (except for IRA#1 and IRA#2) were done with stop loss orders set for 7% below the latest highest close. I really like those automatic sell orders at any time during the day – unlike mutual funds which are only sold at the end of the day, and there is not minimum holding period – like Fidelity’s stupid 30 day hold requirement.

On Chuck Jaffe’s podcast, MoneyLife, for 20Jan16 he featured the the growth at a reasonable price baker’s dozen Sabrient Systems picks. It is a good show to hear. This years list is featured at Sabrientsystems.com but you have to click on firsttrustportfolios.com and then initial offering info to see the list. First trust builds a Unit Investment Trust (UIT) around these 13 stocks so you can buy them all with one purchase of a UIT. I think the UIT fees are excessive and if you want to buy them all it is cheaper just to buy all 13. In 2014 I followed all 13 and purchased one as it was going up. It was a small purchase, but it had a nice gain. I might try that again this year. It is real easy to put 10 or fewer symbols into PerfChart at stockcharts.com to see which investment is doing best over whatever time period you select. The best two over the last 30 days (adjust the time period by double clicking on the 200 days on the bottom axis to enter the number of days you want) are Adobe +3%, and T-Moble US up 2.6%.

On Consuleo Mack’s podcast, Wealthtrack, for 22Jan16 she featured the 10 excessively depressed deep value risky stock “robot” portfolio of John Dorfman. He says even he does not invest in all of them but they have done ~4X better than the S&P500 over the last 17 years. Wealthtrack.com/dorfman-valuable-investing/ contains the list and the podcast is worth hearing. Dorfman fells those stocks priced for perfection like Facebook, Amizon, Netflix, and Goodle are good shorts.

IBD TBP’s Market Pulse is “Uptrend resumes” as of 01/29/16 – If it is still an uptrend in a week, I will probably buy something. It changed to “Confirment Uptrend” on 01/26/16 and then to “Market in correction” as of 01/27/16
If it hadn’t been for Japan changing their policy to charge banks 0.1% interest on their deposits of excess reserves with the Bank of Japan (their FED) the market would not be up as much on Friday. The goal is to force banks to lend money to stimupate the economy and make their currency decline. It must be a good idea, it has worked so “well” in Europe for the last 18 months. The negative interest rate in Switzerland is now the highest at 0.75%.

My current investments:
IRA#1 and IRA#2
GovernmentCashReserves
IRA#2
GovernmentCashReserves

My portfolio changes this weekend:
IRA #1 – None
IRA #2 – None

My portfolio market exposure after this weekend’s changes:
IRA #1 – 00% invested
IRA #2 – 00% invested

Not a bad week. Just a pause in the decline (in my opinion). The biggest up days occur during bounces in bear markets.
Doug Fabian has a podcast where he discusses various ETFs. On his 15Jan16 podcast he discussed where income investors should be investing their portfolios. He likes DBLTX (a mutual fund), BOND, or TOTL as a low risk income fund.The next level with a little more risk and a little more income he likes PFF. In a higher risk income fund he likes closed end funds which are currently selling at a discount and can be purchased in an ETF as PCEF and YYY.
In the 22Jan16 podcast he discussed growth investments and started by saying it was not a time to buy growth investments.

IBD TBP’s Market Pulse is “Market in correction” as of 12/29/15 – Not a time to invest.
Only GovernmentCashReserves, which has an annual yield of 0.01%, is a buy on my list.

My current investments:
IRA#1 and IRA#2
GovernmentCashReserves
IRA#2
GovernmentCashReserves

My portfolio changes this weekend:
IRA #1 – None
IRA #2 – None

My portfolio market exposure after this weekend’s changes:
IRA #1 – 00% invested
IRA #2 – 00% invested

So the worst, first week for any year in the stock market, became the worst, first two weeks for any year in the stock market.
Last week 37% of the Nasdaq stocks were above their 50 day average. This week the number is 29%. I am suprised the market did hot have a big week this week. My guess is that it is bound to have some great up days soon, before the decline continues. The only investments I own, other than money market funds, are a few shares of stock in the companies I work for as part of an employee stock purchase plan.

Has the US lied to you lately? Last week the US Bureau Labor Statistics announced the US gained 292k jobs in Decmember. Yet if you read the statistics in detail the increase was only 11k jobs. The other 281k jobs were a “seasonal adjustment”. About the same ratio was true for the November Jobs report also. Liers, damn liers, and staticians. Economic number watchers frequently complain about the unreliability of statistics from China, perhaps they should look at the US also. Maybe the US economy is not as good as the government claims.
If you have ~50 minutes, James Dale Davidson has a presentation where he tells you how bad things are and then tries to sell you is “Strategic Investment” newsletter. The facts he presents are true and scary. The conclusion may or may not be correct. The conclusions he presents are not positive. All in all an interesting sales pitch.

IBD TBP’s Market Pulse is “Market in correction” as of 12/29/15 – Not a time to invest.
Municipal Income and GovernmentCashReserves are the first and second fund on my list of best funds. They are also the only two funds which do not have a negative precent deviation. This is the first time in years that no other stock or bond funds had a positive precent deviation. I’m sure it also happened in 2008 and 2000.

My current investments:
IRA#1 and IRA#2
GovernmentCashReserves
IRA#2
GovernmentCashReserves

My portfolio changes this weekend:
IRA #1 – None
IRA #2 – None

My portfolio market exposure after this weekend’s changes:
IRA #1 – 00% invested
IRA #2 – 00% invested

Probably the worst week I’ve ever had in investing. Everything is to be sold.
I really expected a big rebound this week. I expected the federal reserve board to say something. I expected the plunge protection committee to intervene. So much for expectations. The unemployment numbers looked good today and yet the market closed down. In bear markets good news is bad and bad news is worse. In bear markest you sell on bounces. Based on some of the business news shows, this is the worst first week of a year in market history.
Last week 43% of the Nasdaq stocks were above their 50 day average. This week the number is 37%. At major market bottoms the number is close to 20%. The 50 day average is significant because major investors use that as a indication of when a stock should be sold.

IBD TBP’s Market Pulse is “Market in correction” as of 12/29/15 – Not a time to invest.
It took 6 days for the “Confirmed Uptrend” to be turned into “Market in correction.” It looks like the major investors did all they could to keep the market from going down significantly before year end so their numbers would not look too bad. Then when the year ended, they had no reason to continue to “paint the tape.”

My current investments:
IRA#1 and IRA#2
SRetailing has a price of 98.70, a sell price of 103.16, a rank of 08, and is a Sell. (ETF – XLY)
IRA#2
SSoftware&ComputerServices has a price of 113.13, a sell price 118.38, a rank of 11, and is a Sell. (ETF – MTK)
SConsumerDiscretionary has a price of 32.10, a sell price of 33.88, a rank of 42, and is a Sell. (ETF – FDIS)
STechnology has a price of 109.98, a sell price of 115.61, a rank of 50, and is a Sell. (ETF – IGM)
My funds lost between 6.06% to 6.87% this week. Every ETF I owned was sold this week when its 7% stop loss was hit.

My portfolio changes this weekend:
IRA #1 – Sell SRetailing
IRA #2 – Sell SRetailing, SSoftware&ITServices – new name, SConsumerDiscretionary, STechnology

My portfolio market exposure after this weekend’s changes:
IRA #1 – 00% invested
IRA #2 – 00% invested

I was looking for a podcast on staying asleep since I wake up about 4am every day and found one by Tim Ferriss. I generally do not listen to The Tim Ferris Show podcasts since most are not on investing and last 2+ hours. His podcast from Oct 16 called “5 Tools I Use For Faster And Better Sleep” had a very interesting sponsor. wealthFront.com/tim offers automatic wealth management at only a 0.25% management fee. They have an evaluation quiz to determine their recommended investments for your age, risk adversion, income, and investment assets. The portfolio they suggested for me are 6 or 7 ETFs. As I decrease my risk tolerance I get more municipal bond ETFs and the less stock ETFs, expecially the US, foreign, and emerging market stocks. They offer slightly different suggestions for IRAs. They use Modern Portfolio Theory (MPT) developed by Markowitz and Sharpe who shared the Nobel Prize in Economics in 1990. A lot has been written about MPT – both suggesting it is great and suggesting it is rotten.
I do suggest you not place too much value on winning the Nobel Prize in Economics. Scholes and Metron won it in 1997. They, along with others, started Long-Term Capital Managment LP (LTCM) in 1993 which made 21% the first year, 43% the second year, 41% the third year but by 1998 had to be bailed out by the Federal Reserve Board and several banks and was liquidated in 2000. The partners once had 1.9b invested of their own money invested in LTCM and ended up with zero.

IBD TBP’s Market Pulse is “Confirmed Uptrend” as of 12/29/15 – If it is still the same in a week I will buy something.
My personal thought is with 43% of the Nasdaq stocks above their 50 day average it is not too bad, but not good.

My current investments:
IRA#1 and IRA#2
SRetailing has a price of 105.21, a sell price of 103.16, a rank of 01, and is a Hold. (ETF – XLY)
IRA#2
SSoftware&ComputerServices has a price of 121.41, a sell price 118.38, a rank of 03, and is a Hold. (ETF – MTK)
SConsumerDiscretionary has a price of 34.17, a sell price of 33.88, a rank of 29, and is a Hold. (ETF – FDIS)
STechnology has a price of 118.09, a sell price of 115.61, a rank of 10, and is a Hold. (ETF – IGM)
My funds lost between 0.11% to 0.96%. Not very wonderful.

My portfolio changes this weekend:
IRA #1 – None
IRA #2 – None

My portfolio market exposure after this weekend’s changes:
IRA #1 – 100% invested
IRA #2 – 80% invested

This week’s podcast, The Disciplined Investor with Andrew Horwitz, CFP, featured an interview with Tom McClellan. McClellan publishes several market newsletters. He has been watching the Euro dollar futures contract as an indicator of market direction. He claims it has worked well for many years in predicting the stock market a year ahead. He says it called for an August top this year, with a contunued decline until April and then not any direction until an up trend in October. Information on his news letter is available at www.mcoscillator.com. The site has a lot of interesting charts and while there you can sign up for a free chart “In focus weekly” email.

Returns for the month of November were negative.
In October IRA#1 -5%, IRA#2 -2%, PDP PIE PIZ DWAS -4%, QQQ -4%, SPY/RSP -6%, DWTR -1%.
For the last 3 months, IRA#1 -2%, IRS#2 -1%, PDPetc 0%, QQQ 3%, SPY/RSP -5%, DWTR -1%.
September portfolio changes:
IRA#1 – Sold FSRPX 11/16, Purchased FSRPX 11/30
IRA#2 – Purchased FSCPX 11/02, FSPTX 11/09, Sold FSRPX 11/16, Purchased FSRPX 11/30
PDP PIE PIX DWAS – none
QQQ – Sold QQQ 11/16, Purchased QQQ 11/19
SPY/RSP – Sold SPY 11/15, Purchased SPY 11/19
DWTR was power 4 – Purchased PSL 10/06, PXI 10/12, sold PXI, PSL 10/19, purchased DWTR 10/19

IBD TBP’s Market Pulse is “Market in Correction” as of 12/13/15 – Not a time to buy.

My current investments:
IRA#1 and IRA#2
SRetailing has a price of 105.33, a sell price of 103.16, a rank of 01, and is a Hold. (ETF – XLY)
IRA#2
SSoftware&ComputerServices has a price of 121.93, a sell price 118.38, a rank of 02, and is a Hold. (ETF – MTK)
SConsumerDiscretionary has a price of 34.40, a sell price of 33.88, a rank of 26, and is a Hold. (ETF – FDIS)
STechnology has a price of 119.24, a sell price of 115.61, a rank of 08, and is a Hold. (ETF – IGM)
SITServices was sold, but the ETF which matched its performance, XLK, has not declined 7% from its highest daily close – yet. I owned SITServices for 63 days and sold it for a 2.64% loss (including distributions) and is up 0.14% since sold. XLK was up 1.18% over the same period and is up 0.65% since. They obviously did not own the same stocks but had similar performance for the 3 months prior to purchase.

My portfolio changes this weekend:
IRA #1 – None
IRA #2 – None

My portfolio market exposure after this weekend’s changes:
IRA #1 – 100% invested
IRA #2 – 80% invested