It's What You Buy and When You Buy (and sell) It

Stock pickers, fund managers, hedge specialists, and financial pundits will be singing the praises of the stock market for 2019, as it will go down in history as one of the better years in terms of percentage gains on the national indices.

Currently, as everybody takes a say off for Christmas, the S&P 500 is up 28.58% on the year, closing in on its best performance sine 2013 (29.60%). This is according to an interactive chart from Macrotrends.net, which shows the annual return on the S&P from 1927 to the present.

While annual returns provide a positive longterm perspective, what happens in real life is more nuanced. Not everybody buys in on January 1 and sells on December 31. Not only would that be foolish from a tax standpoint, i's hardly practical. Securities are bought and sold at varying times of the year. The trick is to time purchases and sales for maximum effect.

What the referenced chart of annual returns doesn't show, is, taking the time period from September, 2018 to the present day, the return is smaller. Those with functioning memories will recall that stocks tumbled in October and December of last year, but staged a mighty comeback in 2019. On September 17, 2018, the S&P closed at 2.929.67. On Tuesday, it stood at 3,223.38. For those who bought at that September 17 high, that comes out as a gain of 10.02% to today. Not bad, but hardly the gaudy percentage for the shorter duration.

This is not to suggest anything: that stocks are overpriced, or that a pullback is imminent, or anything, other than to illustrate that buying at the proper time results in higher returns. It also points up the fact that while the S&P, Dow and NASDAQ are all making new all-time highs presently, they were also doing so last year (and for many years before that). There's no doubt that stocks have been the all-star investments not only of the past decade, but for many decades before, and they probably will continue to be so into the future.

For holders of stocks or owners of pension funds, college funds, index funds, 401k funds, or mutual funds, this portends to be a Merry Christmas, especially if one followed the most simple constructive advice of investing: buy low, sell high.

As it should be, and to all a good night.

At the Close, Tuesday, December 24, 2019:
Dow Jones Industrial Average: 28,515.45, -36.08 (-0.13%)
NASDAQ: 8,952.88, +7.24 (+0.08%)
S&P 500: 3,223.38, -0.63 (-0.02%)
NYSE Composite: 13,895.14, -4.85 (-0.03%)

Merry Christmas from Struggling Retail Sector, Darlene Love Baby Please Come Home

Today, somebody suggested a few ways to "run a few big retailers into bankruptcy."

Don't worry, they don't need any help. They are doing a smash-up job of it all by themselves. JCP will be the first to go; I have a choice parking spot already picked out for the "EVERYTHING MUST GO, CLOSING OUR DOORS, ALL SALES FINAL" going out of business sale at JC Pennys at the local mall (I need some new pants). But, just to be safe, don't bet the house on JCP taking down any banks. Goldman Sucks already has the real estate under many JCP stores locked and loaded.

Actually, Blockbuster already started the trend. There's a huge yellow sign on the Blockbuster near me. Can't miss it. Too bad nobody wants DVDs at anything over $2-4. There are some ebay sellers ready to swoop down and purchase all their remaining inventory for actual pennies on the dollar. 2014 will see numerous large bankruptcies, led by retailers, IMO.

Now, when these retailers start dropping like flies, the media will crow that it's because of the success of the internet (Obamacare web site not included). Net result is moar deflation... err, I mean, disinflation.

And Old Yellen will, as quietly as possible, probably by surreptitious means, increase QE to well over $100k per month, maybe buying up something like securitized student loans gone bad (video out soon).

The government will no longer want the shirts off your backs, because the shirts - sewn in Southeast Asian sweatshops by brown and yellow people who do not matter - aren't worth anything.

Usually, I'm not big on making predictions, as they're difficult to get right and most people will maim you more on your errors, rather than praise your correct calls, but I do believe bankruptcies are in order for 2014 in the retail sector, at least, and spreading to other consumer discretionary companies, maybe a couple of REITs or large mall owners (could be one and the same). More layoffs, more welfare, more SNAP, more phony government statistics, more lame excuses, more liberal apologists, and, as usual, the banks will profiteer like never before.

America has this coming, because it has ignored, squandered and/or pillaged the true wealth of the country - its land, its labor, its accumulated wealth and its populace - to save its fraudulent banking and political system.

As for the markets, the annual year-end ramping continued in Tuesday's short session.

In keeping with the spirit of the season, here's a treat from the David Letterman Show: Darlene Love singing, "Christmas, Baby Please Come Home." If this doesn't bring a tear to your eye, well, then you're either the Grinch or another old Scrooge.



Merry Christmas, and may we all survive the coming New Year!

-- Fearless Rick

DOW 16,357.55, +62.94 (+0.39%)
NASDAQ 4,155.42, +6.51 (+0.16%)
S&P 1,833.32, +5.33 (+0.29%)
10-Yr Note 98.03, -0.11 (-0.11%) Yield: 2.98%
NASDAQ Volume 763.66 Mil
NYSE Volume 1.30 Bil
Combined NYSE & NASDAQ Advance - Decline: 3550-2028
Combined NYSE & NASDAQ New highs - New lows: 587-41
WTI crude oil: 99.15, +0.24
Gold: 1,203.60, +6.60
Silver: 19.48, +0.071
Corn: 434.75, +0.50

St. Nick Drops in on Wall Street

As expected, the jolly old Santa Claus Rally began today with modest gains in a shortened session. Stocks posted gains right from the opening bell, with little inducement to sell shares.

Dow 10,520.10, +53.66 (0.51%)
Nasdaq 2,285.69, +16.05 (0.71%)
S&P 500 1,126.48, +5.89 (0.53%)
NYSE Composite 7,255.00, +37.80 (0.52%)

Advancers beat decliners, 4288-1962. There were 663 new highs and just 66 new lows. Volume was extremely thin.

NYSE Volume 1,413,204,625
Nasdaq Volume 631,728,687

Oil gained 43 cents, closing at $77.10. Gold was up $10.80, to $1,104.80. Silver finished 25 cents higher, at $17.44.

Everybody left happy.

Merry Christmas