CAVEAT: THIS BLOG CONTAINS (albeit often very childish) ADULT-CONTENT. DISCLAIMER: Entries at this blog are akin to good old-fashioned campfire chats; I offer no opinion on what you should or should not purchase, or what you should be using or doing. What does or does not work for me could be long country-miles away from your tastes and your needs. Any products, places, and / or whatnots that I review for this blog are purchased at retail price by me. I do not accept payment, gifts, discounts, freebies, products on loan, demon alcohol, drugs, plea-bargains, probation, parole, Presidential Pardons, or sexual favors for doing any review. TRACKING COOKIES: Google et al sticks tracking cookies on everybody. If you are online, you are being spied on; 'nuff said. You may be able to minimize your online footprints by using Tor and Duck Duck Go. Vive la liberté! Vive all y'all! Ante omnia armari. To each of you, thanks for stopping by!

Thursday, March 6, 2008

Entry for March 06, 2008

First, let me say that I am not rich; I live a nice, comfortable, conservative life. So far, my pension covers all of my needs and the budget sheet projects that it will continue to do so indefinitely. Everything else that I have is gravy, and those assets will be used to cover the unknowns that the future will bring.

I love the stock market. I made my first investments back in 1982. Since then the market has given me many moments of happiness and humility. As soon as I think I have it all figured out, the market again proves to be the master. As with most long-term investors, overall I have made good money. Still, I could have avoided many dumb mistakes by having more education and a larger slice of common sense. The problem with working full time is finding the time and energy needed to do a better job with investments. One of the many reasons I wanted to take an early retirement was to have more time to manage assets. A good portion of my day now is spent reading the financial pages.

Where will the stock market be at the end of 2008? Your guess is probably as good as the experts. Some say the recent market decline is now finding a bottom in the range of S&P 1310. For reason I won’t bore you with, I would prefer to see the market blow off a little more negativity to the downside, and bottom in the range of S&P 1260 – 1280. My wishes aside, we are always stuck with playing the market as it is. If there are some major bond insurance failures, or bank failures, or mortgage company failures, or other debt market surprises, or more wild oil price increases, the market may indeed find some renewed downward momentum. If the market starts to feel comfortable that most bad news is known, then the market needs to find a comfort level with the presidential politics. We all will pay our money and take our chances.

I had very limited exposure to the market downturn, so I have been very fortunate so far. Since November of last year, I have been making some calculated adjustments. My cash fixed-yield portion of the portfolio is still at 56%. My high-yield bond funds (aka junk bonds) have been adjusted from 34% down to 17%. I kept my foreign funds the same at 3%. Domestic stock funds have been adjusted upwards from 7% to 24% of the portfolio value. To keep myself from becoming a day-trading gambler, I only allow myself one day per month to make portfolio adjustments, and I have a maximum dollar amount I allow myself for those adjustments. I prefer trading on days when the market is grim. If the market stays priced reasonably over the next few months, I will pull more money from the junk-bond funds, move it to the domestic stock-funds, and maybe add a tad more into the international funds. If tomorrow the market suddenly starts to make a sustained rally, I would be perfectly comfortable keeping the portfolio as it currently is.

REQUISITE DISCLAIMER: Don’t send your barristers over to see me if you lose your tail playing the market. This blog entry is simply conversation; small talk about investing, nothing is to be considered advice. Who gives the best stock market investment advice? Try looking in the mirror. With education and discipline, chances are you will outplay stockbrokers, bloggers, and most certainly, your brother-in-law.

James A. Zachary Jr.

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