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Franco
06-29-2012, 11:21 AM
"Today, let’s look at an example that affects almost everybody rather than just a handful of rich people. Many people in Washington sanctimoniously say that American households and businesses are too focused on the short term and that we don’t save enough.
But as I explain in this CBNC interview, tax and spending policies from Washington have undermined the incentive to save."

http://danieljmitchell.wordpress.com/2012/06/29/big-government-cripples-incentives-to-save-promotes-risky-culture-of-immediate-gratification/

When growing up, I was always told that no matter how much I earned, that I needed to save a part of every dollar that I earned. Because of government policies, it doesn't pay to save money. However, I'd rather earn zero on my savings than risk my savings in the corrupt Stock Market! Though, when I do save enough to buy real estate, I do so rather than risk my savings in a rigged market and I have never lost money with real estate!
http://danieljmitchell.files.wordpress.com/2009/10/government-solutions.jpg?w=500

menmon
06-29-2012, 03:29 PM
401K is a very good reason to save....no taxes paid on it.

Purchase investment real estate and depreciate expense it against income...not a bad plan either or buy rual real estate and carry it under and ag exemption, not much tax there either.

In spite of the corruption....investing in the stock market and staying in it still is offers the best return.

I'm guessing this guys is saying that Obama his hurt the savers.....inflation will hurt the savers.

Franco
06-29-2012, 05:00 PM
401K is a very good reason to save....no taxes paid on it.

Purchase investment real estate and depreciate expense it against income...not a bad plan either or buy rual real estate and carry it under and ag exemption, not much tax there either.

In spite of the corruption....investing in the stock market and staying in it still is offers the best return.

I'm guessing this guys is saying that Obama his hurt the savers.....inflation will hurt the savers.

I have a 401k and have it all go into a Money Market Account and Bonds. The Bonds have done well this year.

Most of my real estate is in raw land where I can walk it, smell it, hunt it and cut all the firewood I want for free! Use to get a handsome CRP check every year but that has decreased.

One can NOt look at pass performance and say that long term is the way to go. I use to think long term with stocks but this is a new day, a new age and I think the stock market outlook is horrible. Just look at today. Nearly a 300 point rally because the Europeans are going to print more money to keep their out of whack social systems on a resperator. Make zero sense for the Dow to rally on that house of cards.

LokiMeister
06-29-2012, 05:27 PM
I have been getting killer returns since I took investing by the horns and quit putting money into a company managed 401k (scam), other than the matching percentage.

Me also. I use the Motley Fool at fool.com. Very good services like Stock Advisor. Very down to earth people.

Buzz
06-30-2012, 10:46 AM
I have been getting killer returns since I took investing by the horns and quit putting money into a company managed 401k (scam), other than the matching percentage.


We have self directed IRA, and we put 25% of employee earnings into the account each year. I started making a killing when I stopped investing into mutual funds. I only wish I had sold the 100 k or so that I had already put into them. That is my next move. I am sure Sambo would agree that the biggest downside to doing this is that you have to keep up on what you own on a daily basis and most don't have the time, the motivation, or the savvy to keep up. Personally I would say it is worth it.

To Franco, I should have invested in land 10-15 years ago. If you look at historical land prices adjusted for inflation, they are at an all time high. If I had big holdings there, I would be thinking that now is a great time to divest, but who knows, comodity prices might keep things propped up for a while. But, I would be nervous.

I pity anyone who thinks that saving isn't worth it... They have a bleak future in front of them.

Marvin S
06-30-2012, 10:59 PM
401K is a very good reason to save....no taxes paid on it.

Roth IRA is the way to go here - pay taxes early & then grow it tax free. 401K is only good if the underlying funds & the match are, at the least, capable of matching the market.


I have a 401k and have it all go into a Money Market Account and Bonds. The Bonds have done well this year.

Money smarter than us says the joy ride in bonds is about to end :o


We have self directed IRA, and we put 25% of employee earnings into the account each year. I started making a killing when I stopped investing into mutual funds. I only wish I had sold the 100 k or so that I had already put into them. That is my next move. I am sure Sambo would agree that the biggest downside to doing this is that you have to keep up on what you own on a daily basis and most don't have the time, the motivation, or the savvy to keep up. Personally I would say it is worth it.

To Franco, I should have invested in land 10-15 years ago. If you look at historical land prices adjusted for inflation, they are at an all time high. If I had big holdings there, I would be thinking that now is a great time to divest, but who knows, comodity prices might keep things propped up for a while. But, I would be nervous.

I pity anyone who thinks that saving isn't worth it... They have a bleak future in front of them.

The issue with RE is it's not a call up your broker & sell immediately.

IMO one needs a many legged stool even in the stocks & bonds arena. We had that at one time in the bonds including Muni's paying around 8% but they have all been called or matured. This market cycle & the rookies running things have not helped. I believe there are quality funds that provide a stability in one's portfolio while giving a guide against which to measure in any given market cycle. Most of the funds we own are from the early 90's & the poor performers, along with those who changed their philosophy winnowed. Those remaining have performed well but most are closed to new investment - have to see if they are transferable to our heirs. As for stocks we are always looking for long term growers. I remember the Nifty 50, anyone else besides UB remember them :).

wayne anderson
06-30-2012, 11:58 PM
Yes, I remember the Nifty 50 (Personal Finance class at So.Dak. State back in early 1960s). I used 401K to max while employed until retiring in 2005, company had very liberal plan and it was very good for me. I like Buffet's philosophy--invest in campanies (and products) that you understand.

menmon
07-02-2012, 03:41 PM
An S&P 500 Index fund is the best thing most can invest in. Take a dollar cost averaging approach where when the market is high you buy less and more when down and don't try to time the market. Think leading up to the crash in 2008 you would be purchasing a few shares every pay period and the months after it crashed you would have been buying a bunch. Just think if you had not paniced the loses would have rebounded and the shares you purchased after you would have had a good gain.

The reason the market rallies on news of bailout money in Europe is that is what is needs to get that part of the world growing and if they grow we do well.

The conservative rhetoric for government not to spend money right now is the wrong thing for the economy...now if you believe republicans will not spend money, I have beach property in AZ.

Bonds have been the play but they will not produce those returns going forward because rates can't drop much further. The stock market will do well as things get better. I would be buying on the bad news out of Europe, once these things get bettter, the market will rally.

R/E is a good investment as long as your carring cost is low or you can enjoy it like Franco.

Franco
07-02-2012, 08:12 PM
An S&P 500 Index fund is the best thing most can invest in. Take a dollar cost averaging approach where when the market is high you buy less and more when down and don't try to time the market. Think leading up to the crash in 2008 you would be purchasing a few shares every pay period and the months after it crashed you would have been buying a bunch. Just think if you had not paniced the loses would have rebounded and the shares you purchased after you would have had a good gain.

The reason the market rallies on news of bailout money in Europe is that is what is needs to get that part of the world growing and if they grow we do well.

The conservative rhetoric for government not to spend money right now is the wrong thing for the economy...now if you believe republicans will not spend money, I have beach property in AZ.

Bonds have been the play but they will not produce those returns going forward because rates can't drop much further. The stock market will do well as things get better. I would be buying on the bad news out of Europe, once these things get bettter, the market will rally.

R/E is a good investment as long as your carring cost is low or you can enjoy it like Franco.

What do you do when it all comes crashing down? The financial systems in the USA and Europe are built on a house of cards. Inflation is inevitable and most stocks won't be worth wiping one's butt with because we live on Fiat money, here and abroad. Last place I would put my savings is in an instrument that is out of control.

Marvin S
07-02-2012, 11:01 PM
Yes, I remember the Nifty 50 (Personal Finance class at So.Dak. State back in early 1960s). I used 401K to max while employed until retiring in 2005, company had very liberal plan and it was very good for me. I like Buffet's philosophy--invest in campanies (and products) that you understand.

I learned what little formal stuff I had at Mines in Econ 101 - don't put all your eggs in one basket ;) . How many of the Nifty 50 survive today in any form & how many are nifty :). I'm going to do a thread on Buffett shortly as he is not the wizard he is portrayed to be - Peter Lynch on the other hand is quite bright & used that philosophy at Fidelity Magellan in it's glory years.


An S&P 500 Index fund is the best thing most can invest in. Take a dollar cost averaging approach where when the market is high you buy less and more when down and don't try to time the market.

The conservative rhetoric for government not to spend money right now is the wrong thing for the economy...now if you believe republicans will not spend money, I have beach property in AZ.

I invite those of you who are interested to go to Yahoo finance & look at the long term charts for VFIAX (an S&P 500 fund) & MDY (a midcap 400 fund). Decide for yourself if mr IHOP has a clue :confused:. There is a reason banks hire C- students :p.


What do you do when it all comes crashing down? The financial systems in the USA and Europe are built on a house of cards. Inflation is inevitable and most stocks won't be worth wiping one's butt with because we live on Fiat money, here and abroad. Last place I would put my savings is in an instrument that is out of control.

I am sure you have done all the research to back your statement - are you saying all the folks who went through the crash of "29-'31 ended up broke? I don't think so :).

caryalsobrook
07-03-2012, 06:33 AM
We have self directed IRA, and we put 25% of employee earnings into the account each year. I started making a killing when I stopped investing into mutual funds. I only wish I had sold the 100 k or so that I had already put into them. That is my next move. I am sure Sambo would agree that the biggest downside to doing this is that you have to keep up on what you own on a daily basis and most don't have the time, the motivation, or the savvy to keep up. Personally I would say it is worth it.

To Franco, I should have invested in land 10-15 years ago. If you look at historical land prices adjusted for inflation, they are at an all time high. If I had big holdings there, I would be thinking that now is a great time to divest, but who knows, comodity prices might keep things propped up for a while. But, I would be nervous.

I pity anyone who thinks that saving isn't worth it... They have a bleak future in front of them.

It is refreshing to see a post by you absent graphs that are mininterpreted or just downright false. You say "you pity anyone who thinks that saving isn't worth it". Let me tell you of a dear friend of 40 years who was like a brother. He made his money in commercial real estate and was quite successful at it, making an income of at least seven figures. His goal was to use as little of his money and as much of the bank's money in his investments. Just before he died, he was negotiating a bank loan for another of his investments and the loan officer commented that he wanted a 30 year loan and questioned why so long a loan given his age. His response was that the only reason he wanted a 30 year loan was because he felt that the bank would not make him a 40 year loan! I'm sure he had managed to move some of his debt free assets to his son before he died and avoided any death taxes. He lived a lifestyle of the so called 1% with the desire to spend his last nickel the day he died. Frankly I am not as smart as he. I'm sure I would probably miscalculate.

You used to advocate ordinary income tax on estates. Given that when you die, the only tax exemption you estate would have is burial expenses and I am not sure they are deductible, tell me why you would pity him and why you think his life was bleak? Given the death tax, just asking;)

Franco
07-03-2012, 09:19 AM
I am sure you have done all the research to back your statement - are you saying all the folks who went through the crash of "29-'31 ended up broke? I don't think so :).

What I am saying is that there is no rhyme or reason as to the way stocks fluctuate in value. How many stocks have we seen zoom up in price when those companies have yet to turn a profit, then go bust or near bust? Stock value today has more to do with what money manipulators do, as opposed to the real value of a company.

Also, look at the policy of the Fed Reserve in keeping interest rates artificially low. Not only did this policy fuel the housing crisis that hit much of this country, the current Fed policy is a recipe for disaster.
http://sphotos.xx.fbcdn.net/hphotos-prn1/s480x480/555492_419337931450434_1241064014_n.jpg

LokiMeister
07-03-2012, 09:48 AM
What I am saying is that there is no rhyme or reason as to the way stocks fluctuate in value. How many stocks have we seen zoom up in price when those companies have yet to turn a profit, then go bust or near bust? Stock value today has more to do with what money manipulators do, as opposed to the real value of a company.

Also, look at the policy of the Fed Reserve in keeping interest rates artificially low. Not only did this policy fuel the housing crisis that hit much of this country, the current Fed policy is a recipe for disaster.

Actually, if you truly watch the market and watch a stock, there is a rhyme and reason why the stocks fluctuate in value from day to day. You can also see why a stock will go up or down over time. Is there manipulation of the stock market? Sure, but not as significant as you think. Watching and play the market has shown me that.

The big problem with the raw land that you buy Franco is you truly don't know what it is worth. It is only worth what someone will pay for it. And after a few years of ownership, there could be a market for it or there might not be. Then you have the property taxes that you have had to pay, further decreasing your return. You would be better off buying an apartment building where people are paying you to stay there.

huntinman
07-03-2012, 10:32 AM
Actually, if you truly watch the market and watch a stock, there is a rhyme and reason why the stocks fluctuate in value from day to day. You can also see why a stock will go up or down over time. Is there manipulation of the stock market? Sure, but not as significant as you think. Watching and play the market has shown me that.

The big problem with the raw land that you buy Franco is you truly don't know what it is worth. It is only worth what someone will pay for it. And after a few years of ownership, there could be a market for it or there might not be. Then you have the property taxes that you have had to pay, further decreasing your return. You would be better off buying an apartment building where people are paying you to stay there.

Can't shoot ducks and geese in an apartment building...

Buzz
07-03-2012, 10:58 AM
It is refreshing to see a post by you absent graphs that are mininterpreted or just downright false. You say "you pity anyone who thinks that saving isn't worth it". Let me tell you of a dear friend of 40 years who was like a brother. He made his money in commercial real estate and was quite successful at it, making an income of at least seven figures. His goal was to use as little of his money and as much of the bank's money in his investments. Just before he died, he was negotiating a bank loan for another of his investments and the loan officer commented that he wanted a 30 year loan and questioned why so long a loan given his age. His response was that the only reason he wanted a 30 year loan was because he felt that the bank would not make him a 40 year loan! I'm sure he had managed to move some of his debt free assets to his son before he died and avoided any death taxes. He lived a lifestyle of the so called 1% with the desire to spend his last nickel the day he died. Frankly I am not as smart as he. I'm sure I would probably miscalculate.You used to advocate ordinary income tax on estates. Given that when you die, the only tax exemption you estate would have is burial expenses and I am not sure they are deductible, tell me why you would pity him and why you think his life was bleak? Given the death tax, just asking;)I am not in the position to explain the details, but I kindA like the idea of having something left to pass on to my daughter. If you think it is good to be left with nothing so your kids don't have to suffer the fate of a portion going to the tax man, that is fine. There are accountants and lawyers who specialize in estate planning. Maybe your friend should have visited with one. We have good lawyers and they are full of great ideas that we never considered on our own. It is a shame that the tax code is complicated enough to have created that industry but it is what it is.I don't plan to work all my life and don't want to be poor in my old age. Do you live on SS?

Franco
07-03-2012, 11:47 AM
Actually, if you truly watch the market and watch a stock, there is a rhyme and reason why the stocks fluctuate in value from day to day. You can also see why a stock will go up or down over time. Is there manipulation of the stock market? Sure, but not as significant as you think. Watching and play the market has shown me that.

The big problem with the raw land that you buy Franco is you truly don't know what it is worth. It is only worth what someone will pay for it. And after a few years of ownership, there could be a market for it or there might not be. Then you have the property taxes that you have had to pay, further decreasing your return. You would be better off buying an apartment building where people are paying you to stay there.

I own some rental condos is desirable locations that attract quality tennants too. I refuse to deal with mariginal rental property, I'll leave that for the middle-easterners that live in here. I'll have to post a pic of a Whitetail buck that I shot on my raw land;-)

As far as rhyme and reason with stocks, I read the stock market report daily. Events like US stocls tanking because Greece might not get bailed out or market going up after banks have been downgraded, shakey economy and some vague data report is all market manipulation! The economy is NOT sound, our monetary policy is in the toliet and our ever growing Fed Gov does not make for a healthy stock environment. If we had real Capitalism and real Free Markets I would take a different view.

Buzz
07-03-2012, 12:02 PM
I own some rental condos is desirable locations that attract quality tennants too. I refuse to deal with mariginal rental property, I'll leave that for the middle-easterners that live in here. I'll have to post a pic of a Whitetail buck that I shot on my raw land;-)

As far as rhyme and reason with stocks, I read the stock market report daily. Events like US stocls tanking because Greece might not get bailed out or market going up after banks have been downgraded, shakey economy and some vague data report is all market manipulation! The economy is NOT sound, our monetary policy is in the toliet and our ever growing Fed Gov does not make for a healthy stock environment. If we had real Capitalism and real Free Markets I would take a different view.


One problem with the market is that it is dominated by traders, not investors. To learn what an investor is, see "The Intelligent Investor" by Benjamin Graham. Best book I ever read. I will agree that the stock value of good stocks goes up and down for no apparent reason. It is the herd mentality of "the traders." I know that Marvin will beg to differ and point to Lynch.

LokiMeister
07-03-2012, 12:07 PM
If you don't actively invest in stocks you might not get what I am talking about. Spend some time on www.fool.com and you might begin to see what I am talking about. Reading the stock report every day will show you that things are being manipulated. Actually invest in a number of good stocks will show you that it isn't manipulated as much as you think.

I know I can't get you to change your mind, Franco, but what happens to your land when no one wants to buy it and the good stocks I bought that got manipulated are still worth something?

One thing you have to realize when you talk to financial reps and people is that they aren't necessarily concerned with the economy. Look at the market the last three years. Economy in the tank, market back up to where it was in 2007. It was a buying opportunity.

Franco
07-03-2012, 12:11 PM
I'm headed for Barnes & Noble after lunch for a DVD, I'll pick a copy of the book up.

Marvin S
07-03-2012, 08:00 PM
One problem with the market is that it is dominated by traders, not investors. To learn what an investor is, see "The Intelligent Investor" by Benjamin Graham. Best book I ever read. I will agree that the stock value of good stocks goes up and down for no apparent reason. It is the herd mentality of "the traders." I know that Marvin will beg to differ and point to Lynch.

You're a smart guy if you know what I think :-P - actually I have an unread copy of Graham's book which I bought during a move & haven't been able to locate it since. What folks say he says is nothing outstanding but I can point out many fairly good investors who follow his approach or so they say - Allmon, Price, Henke, etc. seems their brand of Graham only worked during certain market moods but sounds good to the average investor. Those are the funds that have been long jettisoned along with the momentum folks. If you had been following the market during the latest drop you would have noticed that sound companies, well managed do not drop like the rest - look at MKC, JNJ, PLL as examples. & you could look at the examples I gave IHOP - certain sectors are a must. A good scare seems to do more for the astute investor than the so-called herd mentality. I believe I read somewhere recently that 80% of all trades are computer driven, as long as you know those conditions exist you can work to the model. As for folks whom I respect Ralph Wanger & Charles Royce would come to mind. I have been in both Acorn & Penn Mutual since the late 80's. Acorn's "Squirrel Chatter" (comes in the regular reports) is a must read & immensely informative on a current & future events basis while the Royce fund's messages are somewhat more geeky. When I talk to the better half I remind her that Royce was the guy in the bow tie who spoke so eloquently at the luncheon the Royce funds hosted for their local area investors. Forbes featured Royce recently as the driving force behind the restoration of an iconic lodging on the East Coast.

I equate some of the talk to Wooden's invention of the "Zone Press" at UCLA in the 70's. The only issue I have with that is our local team in SD was using the same press in the late 40's & our coach had used it during his playing days in the mid-40's. So a lot of things sound good are pure BS.

I'm mostly self taught through trial & error - & fortunately the errors are less than the good ones - some stocks treat you well & some don't though they appeared to be sure things initially.

As for the offspring - they get what's left - as long as the taxman shareth not. I was going to fund a scholarship at SDSM&T but found they no longer track the data necessary to make that what I wanted it to be. While I was there the Dean of Students & I did not see I2I so I was going to show him what it took to be a success. Though in general what the folks in charge thought made a model student was correct, there is room for the guy who thinks creatively outside the box :). For the annual Beard Derby festivities & dance we did the local tav's for some gals for some of the hardup guys at Mines to frolic the dance floor with - this offended the sensibilities of the faculty. Of course this was not the only thing where the accusations had some merit or maybe none but that made no difference to this little tyrant. Which only made some of us get more creative ;-). As per usual there were the toady's that would not challenge anyone, sort of like the FT game :-P.

caryalsobrook
07-05-2012, 06:55 AM
I am not in the position to explain the details, but I kindA like the idea of having something left to pass on to my daughter. If you think it is good to be left with nothing so your kids don't have to suffer the fate of a portion going to the tax man, that is fine. There are accountants and lawyers who specialize in estate planning. Maybe your friend should have visited with one. We have good lawyers and they are full of great ideas that we never considered on our own. It is a shame that the tax code is complicated enough to have created that industry but it is what it is.I don't plan to work all my life and don't want to be poor in my old age. Do you live on SS?

Maybe you should read my post with a little more comprehension. I did state that he had moved assets to his son before he died. I assure you he made his son comfortable, quite comfortable, probably in the top 1/10th of 1% in terms of wealth, BEFORE HE DIED! He was smart enough not to need estate planners in order to get around the rediculous tax code that you have so many times advocated. I did say tht he wanted to spend his last nickel that last day of his life. that is one goal that he would say that he was not able to accomplish, but he tried. As to working he also worked until he died, a goal he also had and did achieve. That was his choice as to the way he wanted to live his life. He loved to work and he loved to make money.

You asked if I live on SS. Since you have seen and replied to previous posts of mine, I suspect you asked the question sarcastically and not out of stupidity, but I will answer it anyway. My SS probably pays my utility bills which include electric, gas, water, tv, internet and phone, nothing else. Everything else is paid from personal income. Personally, I have been quite fortunate. My net worth has gone up in the past 3 years at least 30% due to my choice of investments. You say the tax code "is what it is" (maybe we need a definition of the word "is"). I would say it is what it SHOULD NOT BE! I guess that if I was as smart as Bill was I would not give a damn what the tax code is, you think?

Franco
07-05-2012, 07:44 AM
If you don't actively invest in stocks you might not get what I am talking about. Spend some time on www.fool.com (http://www.fool.com) and you might begin to see what I am talking about. Reading the stock report every day will show you that things are being manipulated. Actually invest in a number of good stocks will show you that it isn't manipulated as much as you think.
something?

I know I can't get you to change your mind, Franco, but what happens to your land when no one wants to buy it and the good stocks I bought that got manipulated are still worth
One thing you have to realize when you talk to financial reps and people is that they aren't necessarily concerned with the economy. Look at the market the last three years. Economy in the tank, market back up to where it was in 2007. It was a buying opportunity.

People always want land, just a matter of, can they afford it. In the last 20 years, raw land has continued to increase in value espacally if managed right. Other than the recreational value, there is always a value for the timber which grows is value every day. Unlike stock values that can vanish in hours, land is doing anything but go up.

After reading Graham's book yesterday, I will say that there wasn't anyhting new or revealing in it. What he doesn't write is that real estate, is the ulimate long term investment!

Buzz
07-05-2012, 09:10 PM
People always want land, just a matter of, can they afford it. In the last 20 years, raw land has continued to increase in value espacally if managed right. Other than the recreational value, there is always a value for the timber which grows is value every day. Unlike stock values that can vanish in hours, land is doing anything but go up.

After reading Graham's book yesterday, I will say that there wasn't anyhting new or revealing in it. What he doesn't write is that real estate, is the ulimate long term investment!

I wish I could read that book in a day. I learn something every time I pick it up, so you're in a different class than me.

Marvin S
07-05-2012, 11:18 PM
I wish I could read that book in a day. I learn something every time I pick it up, so you're in a different class than me.

Franco did not say he learned anything :p, he just said he read it - one has to be receptive to improve their knowledge, sort of like yourself when there is a discussion of unions ;).