retirement interruptus: That Was The Week That Was-4th Week June

Stuff you may not have known about our 4th of July Holiday.

Legal separation from Great Britain occurred on July 2, 1776.
Approval of Declaration of Independence date July 4th.
John Adams and Thomas Jefferson died on the same day July 4, 1826.
James Monroe died on July 4, 1831.
Calvin Coolidge was born on July 4, 1872.

Alternative Investments? Good For You? Alternative investments are being touted as the next best thing for the average person’s portfolio since the invention of the Easy Bake Oven. What are alternative investments? Investopedia defines them as ‘not one of the three traditional asset types’ – stocks, bonds or cash. In most cases these type of investments are owned by large institutional or net worth individuals because of their complexity and lack of liquidity. Alternative investments include managed futures, real estate, derivatives, commodities and hedge funds. While most alternative investments don’t fit the average investor investment profile a few may be worthy of consideration. Real estate, precious metal and commodity investments are highly liquid and fairly inexpensive to buy if using an ETF or mutual fund. At some point they may be excellent choices during periods of inflation, or extreme market malaise.

Shucks! A Possible Side-Ways Market? Half-way through the year and the Dow shows slight gain while active managed funds are doing much better. The opportunity of a double digit year for the broader indices is looking about as good as Donald Trump switching hair stylists.

Brett Arends wrote an essay for MarketWatch.com entitled 25 things I wish I knew when I graduated from high school. He wrote he had to learn a lot of things the hard way. Here are a few of my ideas on what someone graduating from high school should know about money:

If you are unable to get your brain around money management invest in a simple broad stock market index fund and stick with it. (If you don’t know what that is simply search online for stock index funds)
If the investment isn’t 100% liquid you don’t buy it.
Ignore everyone and everything that preaches you should actively trade your investments.
Time, patience, consistency and simplicity will generally make you more money than following the advice of the ‘Hoot & Holler Folk on Cable TV’.
Pay Yourself First. Act as if you owe yourself and put your name first on the list of bills to pay.
Try to get at least one year’s living expenses saved. You’d be delighted how independent and less stressful you’ll feel.
Get a small Tupperware box and at the end of the day empty your spare change and singles. At the end of the year you’ll be surprised how much you’ve accumulated. Buy yourself something special or go on vacation.
Don’t marry someone who owes a great deal of money, doesn’t really know how much and doesn’t care. There’s always a bad ending here.
Stay away from so-called financial planners that ‘know’ how your life will play out even through you don’t.
Saving and accumulating as much money as you can is about the best financial plan you can have.

Made me smile… Got

‘er done…! Almost.

Greek Deal Possible Relief Rally Monday. Markets up triple digits! ‘The Europeans have raised brinkmanship to an art form.’ – CNBC.com 6/22/2015

Robert C. Doll, CFA Nuveen Asset Management June 22, 2015. Key Points:

Leading global economic indicators point to improving signs for growth.
Fed monetary policy decisions remain deliberate and measured.
Corporate profit expectations should gradually strengthen later this year, which should be positive for equities.

First Time Home Buyers Drive U.S. Home Sales to Best Since 2009. We need, and usually have gotten, real estate, as the catalyst to a recovery. This last Depression it didn’t happen for many good reasons. But now it seems new home buyers are back and first timers accounted for 32% of the purchases, matching the highest share since September, 2012. Reasons are lower down payment requirements, rising rents and brighter employment picture. Reported BloombergBusiness June 22, 2015.

OVERHEARD ON CNBC ONCE THE GREEK PROBLEM IS IN THE REARVIEW MIRROR INVESTORS CAN ONCE AGAIN WORRY ABOUT CORPORATE EARNINGS.

Finra accuses broker of trying to bilk Alzheimer’s client of $2M! According to Investment News of 6/22, FINRA, the regulatory body, has identified a former stockbroker that had an 81 year old Alzheimer’s patient assign him as the beneficiary of her trust. The outcome is still unknown but I’ve written about Elder Abuse and Practices before. Children of elderly parents have to be aware of what’s going on with their parent’s money. The very least you should have a ‘talking’ relationship with your parent’s advisors.

Greek Impasse & Carl Icahn Comments Wednesday Drags Markets to Triple Digit Loss.

Icahn ‘warns’ people that the high yield market is ‘almost ridiculous’ you can buy a 5 1/4% high yield when you can buy a corporate bond that won’t go bankrupt and take a possible 40% loss for an extra 2% and (people) think they’re smart.’ CNBC 6/24/2015

Dow fell 75 Points Thursday as Transport Index Fell and DJIA followed. China Shanghai Composite continued its fall down 7% as the two week selloff continued.Morgan Stanley cautioned its investors not to buy the dip. The bank lowered its price target for the Shanghai citing concerns like lofty valuations and high margin debt. WSJ 6/25/2015

The Greece problem is like your unemployed brother-in-law living in your basement with no intention to get a job, pay his bills and worse, move on out. The Greek pension system is broke with age 55 being the normal full retirement age for men and age 50 for women. It is the single sticking point that Greek citizens are adamant about but needs to be negotiated. This bears a striking similarity to trying to modify our Social Security system.