Wednesday, March 8, 2017

Observations and Sample of Recent Trades 3/8/17 (AX.UN:CA-ARESF, CBL, CBLPRD, SCHF, IMGN, VHT, VGK )/ Trump and McCarthyism/ Trump Daily Intelligence Briefing: Watching Fox and Friends

Trump, Roy Cohn and McCarthyism:

In one of his recent tweets, Donald claimed that Obama had wiretapped the entire Trump Tower and that Obama's alleged conduct smacked of McCarthyism: 



"Terrible! Just found out that Obama had my "wires tapped" in Trump Tower just before the victory. Nothing found. This is McCarthyism!"

Besides being unable to spell simple words, Donald apparently does not know the meaning of McCarthyism, which is strange since he was a protege of Ray Cohn who was Senator's McCarthy's right hand man:  

The president accused Obama of ‘McCarthyism.’ But Trump’s mentor helped enforce it. - The Washington Post

What Donald Trump Learned From Joseph McCarthy’s Right-Hand Man - The New York Times

Donald does have Roy's main personality attributes and that is not a compliment. 

For those youngsters who do not know about Senator McCarthy (R.Wis.) and the true meaning of McCarthyism, I have linked the following primers: 


When someone makes a serious allegation against another without proof, that is McCarthyism, Donald. So your four tweets about Obama tapping your phones are examples of McCarthyism.   

Donald's new mentor, Steve Bannon, believes that McCarthy was someone worthy of emulation, which is not surprising. Steve Bannon in 2013: Joseph McCarthy was right in crusade against Communist infiltration - CNN 

+++++++++++


Trump's Daily Intelligence Briefing Sourced From Fox and Friends:


Donald just loves the Fox and Friends show since the hosts fawn over him endlessly and never contradict him with facts. 


In Monday's intelligence briefing from Steve Doocy, the mandatory Fox Faux Blonde (this one is known as Ainsley Earhardt) and Brian Kilmeade, Donald shared with the world what he learned in six tweets. 


The Fake News Creator-In-Chief felt compelled to embellish what he learned from those "TV Personalities", as usual. 


For example, Trump's intelligence briefing referred to a former GITMO prisoner being killed by an airstrike in Yemen. There was a gleaming gold headline flashed on the screen:  “GITMO PRISONERS REENGAGED IN TERRORISM”.


Trump then published the following tweet: 


"122 vicious prisoners, released by the Obama Administration from Gitmo, have returned to the battlefield. Just another terrible decision!"


As it turns out, 113 of those 122 Gitmo prisoners were released by George Bush. Donald could care less about that factoid. The Fake News Creator-In-Chief is entitled to his own facts. 


Fact-Check: Trump Is Wrong About Guantánamo Detainees - The New York Times


You’ll never guess who tweeted something false that he saw on TV - The Washington Post


Will Donald correct any false statement made by him? 


Never is the obvious answer. 


On the contrary, he will continue to make the same false statement over and over again even when there is an abundance of irrefutable evidence that establishes the statement's falsity. Welcome to the new Alternate Reality Universe created by Donald.  


Trump could care less about providing Trump Nation with accurate information. 


Donald learned from his mentor, Roy Cohn, that facts are irrelevant. Facts are always irrelevant to demagogues. And, as Roy taught his pupil so well, it is critical to never admit being wrong, no matter how much evidence stacks up against an obviously false statement.  


Trump’s split screen: A two-hour virtual conversation between the president and ‘Fox & Friends’ - The Washington Post

The President Essentially Live Tweeted Fox & Friends This Morning | TVNewser

+++++++++++++


Donald's Inability to Spell Simple Words:  


The average grade school child could beat Donald in a spelling bee. The average fifth grader may be too high of a hurdle for Donald, so the kid needs to be given some kind of handicap. 


President swings and misses twice in attempt to spell 'hereby'

A look at the misspelled tweets of President-elect Donald Trump - NY Daily News


Maybe I am being unfair. I am not as old as Donald, and my brain misfires too. However, my remaining brain synapses are not misfiring all of the time-yet. And, I am not the President, lack access to the nuclear codes, and don't have to worry about hitting wrong buttons-yet.

+++++++++++

New Yorker Magazine Investigation Into Possible Trump Violations of Foreign Corrupt Practices Act


Donald Trump’s Worst Deal - The New Yorker


"The President helped build a hotel in Azerbaijan that appears to be a corrupt operation engineered by oligarchs tied to Iran’s Revolutionary Guard."


This is another area in need of further investigation which will never happen for as long as the GOP controls both the Senate and the House. 


Trump's tax returns were not disclosed because he wants to hide dealings with nefarious characters.  The GOP members in Congress, including Devin Nunes, will continue to provide cover for Trump. 


Donald Trump's most important friend in Congress-Devin Nunes | MSNBC


When is Jeff Sessions going to start his investigation?

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"Let Them Eat Cake" 


Modern Version: In responding to a question about low income families being able to afford healthcare under the GOP's plan, Jason Chaffetz (R.Utah) retorted that those low income people need to give up their IPhones and spend the money on health insurance. Chaffetz: Americans may need to choose between iPhone or healthcare | TheHill

That response indicates what I would label the typical alternate universe that republican House members inhabit.

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I am behind discussing my bond and CD purchases. The intermediate bond purchases discussed below and in subsequent posts continue to decline slightly in price and can be purchased now at lower prices than shown for my trades.

I am more concerned now with the return of my money than the return on my money.

++++++++++++

1. Intermediate Term Bond Ladder Basket Strategy

A. Bought 2 Apple 2.5% Senior Unsecured Bonds Maturing on 2/9/25:

                                                        

Issuer:  Apple Inc. (AAPL) 
Finra Page: Bond Detail (prospectus not linked)
Moody's at Aa1
S & P at AA+
YTM at Total Cost (97.435):  2.863%

This Apple bond closed at 96.13 today, creating a YTM of 3.055%. 

B. Sold 2 CBL 5.25% Senior Unsecured Bonds Maturing in 2023:

                                          
                             
Profit Snapshot: +$39.88

                                           

Issuer: CBL & Associates Properties Inc.  (CBL)-REIT Owner Of Malls
FINRA Page: Bond Detail

Rationale: On 2/24/17, another major anchor for mall stores, J.C. Penney, reported a larger than expected decline in same store sales and announced that it will close 130-140 underperforming stores. Reuters

Box retailers are in a clear downsizing mode.

Moody's: Disappointing holiday prompts cautious planning for 2017 and continued store rationalization

I decided to liquidate my small CBL positions in response. The other position liquidated at a small profit was CBLPRD:

Profit Snapshot +$23.98

                                        

CBL & Associates Properties Inc. 7.375% Cumulative Preferred Series D

I did receive one quarterly dividend payment.

The common shares had a bad day on 2/24/17: CBL $9.97 -$0.40 -3.86%

C. Bought 2 Verizon 2.45% Senior Unsecured Bonds Maturing on 11/1/22:

                                                 
FINRA Page: Bond Detail
Credit Ratings:
Moody's at Baa1
S & P at BBB+
Fitch at A-
YTM at Total Cost (97.319 ): 2.967%

This bond closed at 96.1 today, creating a YTM of 3.211%.

I have 2 Verizon 1.1% senior unsecured bonds maturing on 11/1/2017. This bond was bought a a total cost below par value on 1/12/17 (YTM at 1.222%). I may use the proceeds to buy another VZ bond maturing in 2023.

D. Bought 1 U.S. Bank (USB) 2.375% Senior Unsecured Bonds Maturing on 7/22/26:

                                                   
Finra Page: Bond  Detail
Credit Ratings:
Moody's at A1
S & P at A+
Fitch at AA
YTM at Total Cost (94.231 ) = 3.087%

This is another bond where I will likely buy more, but only at lower prices.

E. Added 1 Northern States 2.15% First Mortgage Bond Maturing on 8/15/22:

     

My last purchase of this bond was in a taxable account. I bought this one in a Roth IRA.

FINRA Page: Bond Detail
Credit Ratings:
Moody's at Aa3
S & P at A
Fitch at A+
YTM at Total Cost (98.026 ) = 2.581%

I currently own 3 of this first mortgage bond with 2 owned in Roth IRA accounts.

2. Short Term Bond/CD Ladder Basket Strategy:

A. Bought 1 Bank of Baroda .85% CD Maturing on 12/11/17:

    

B. Bought 2 Franklin Synergy Band 1.1% CDs (monthly interest) Maturing on 7/16/18:

                                        

C. Bought 2 UST .625% Maturing on 5/31/17




3. Continued Paring Stock Allocation:


A. Pared Artis REIT: Sold 200 AX-UN:CA at C$12.94:


                                           

Quote:  Artis Real Estate Investment Trust (AX.UN:TOR)

Company Website: Artis REIT
Portfolio Map

Profit Snapshot: +C$96.5



As with other Canadian REITs that I own, Artis pays monthly distributions of C$.09 per unit. The last ex date was on 2/24/17. Distribution History

Sourced:  2016 Annual Report

I last eliminated my CAD priced ordinary shares in 2014: Item # 1 SOLD 300 AX-UN:CA at C$15.71 (9/26/14 Post)-Item # 1 Bought 300 of Artis REIT at C$14.36 (9/28/13 Post)

Artis and other Canadian REITs have been hurt since the 2014 summer due to economic slowdowns caused by the crude oil price collapse, particularly in the Alberta province. There will be over time repeated boom and bust cycles in those property markets.

I still own 300 ARESF shares, the USD priced ordinary Artis units that trade on the U.S. pink sheet exchange. The ARESF price will reflect the price of the units traded in Toronto converted into USDs.

B. Sold 102+ of the ETF SCHF:

Profit Snapshot:  +$65.77

                                      

QUOTE:  Schwab International Equity ETF (SCHF)

I have been selling small stock fund positions as a preferred way to raise cash when I am paring my stock allocation. International stock funds have underperformed the S & P 500 due in part to the strength of the USD.

The three year annualized average total return for this fund was -.28% through 2/28/17, compared to an annualized average total return of 10.51% for the  S&P 500 ETF (SPY). International stock funds will have their day in the sun, but continued strength in the USD will be a headwind for USD priced international funds.

C. SOLD 100 IMGN AT $3.55:

                                       

Profit Snapshot: +$77.48

    

I sold my highest cost lots into a price spike that started on 12/30. The shares had closed at $1.58 the prior day and soared to $2.04 on 12/30. There was another spike to $2.49 (1/4/17)  from $2.08. The last spike started after a 2.47 close on 2/22 that took the price up to an intra-day high of $3.78 on 2/28. The price spike was in three stages: IMGN

I still own a 50 share lot bought at $1.77 (12/12/16). Maybe I can afford to hold onto that lot for awhile.

D. Sold 15 VHT at $139.69:

VHT Fund Quote-Vanguard Health Care ETF Fund

This ETF can be bought by Vanguard customers commission free which makes small lot trading cost effective.

                                        


Profit Snapshot: +$190.84

                                         


E. Sold 25 out 132 shares of VGK at $50.21-ROTH IRA: This is another ETF that can be bought commission free by Vanguard customers.

                                        


VGK Fund Quote - Vanguard FTSE Europe ETF

Profit Snapshot: +$43.87


                                         

I still own 107+ VGK shares and plan to keep those shares and to continue reinvesting the dividend.

Disclaimer: I am not a financial advisor but simply an individual investor who has been managing my own money since I was a teenager. In this post, I am acting solely as a financial journalist focusing on my own investments. The information contained in this post is not intended to be a complete description or summary of all available data relevant to making an investment decision. Instead, I am merely expressing some of the reasons underlying the purchase or sell of securities. Nothing in this post is intended to constitute investment or legal advice or a recommendation to buy or to sell. All investors need to perform their own due diligence before making any financial decision which requires at a minimum reading original source material available at the SEC and elsewhere. A failure to perform due diligence only increases what I call "error creep". Stocks, Bonds & Politics: ERROR CREEP and the INVESTING PROCESS Each investor needs to assess a potential investment taking into account their personal risk tolerances, goals and situational risks. I can only make that kind of assessment for myself and family members

8 comments:

  1. South Gent,

    I am going to hold onto my IMGN. Your 28% gain in IMGN is respectable; however, maybe we could aim higher for the lotto tickets? OCRX is up 85% today (but it lost 70% of its market value on 1/30/2017). My holding in ZSAN is up 108% so far (down from a gain of 184% back in mid-February). I am still grabbling with the exit rules of my biotech lotto ticket basket. It can't be the same as those for the core holdings or the trading positions!?

    ReplyDelete
    Replies
    1. Y: When I started last year a Lotto Ticket basket strategy for small cap biotechs, my plan was to hold unless the firm's most important drug candidate failed in a trial.

      Now, it is pure entertainment for me since I am not getting much of a rush from buying high quality bonds. Consequently, there are no rules, just a gambling rush with a few dollars.

      Possibly, the up and down movements of some purchases, like ADXS, convinced me to harvest at least some profits while I had them. Hopefully, I will not sell the one that develops a cure for cancer.

      I may buy IMGN back. I still own 50 shares bought at $1.77. Maybe I will be able to resist taking my profit on that $90 out-of-pocket position. I sold some CYTK shares for a profit but still own 80 shares.

      Delete
  2. South Gent,

    OCRX is up again at +34% as of 10:30am this morning. My overall position in OCRX has turned from a deep loss to a gain in two days. The push came from the statistically positive indicators from further analysis of initially disappointing phase 2b data, which had caused the 70% drop. Who could have seen that!!

    I would agree with you that if "the firm's most important drug candidate failed in a trial", it would be a sell. There will be other rules; however, a percentage based rule seems less relevant in a micro cap biotech lotto ticket basket.

    ReplyDelete
  3. Hi SG,

    I have to apologize, but I am having trouble following the new blog. I will read through some older postings to see if I can catch up.

    I am still working on exactly what I need to achieve with my own basket strategy. I have some prefs and some 3 year bonds, but really nothing compared to where I need to be.

    I am currently liquidating real estate and that is taking a while, but will give me the cash I need for bond and pref share lots.

    I plan to ladder them and hope for 1, 2 and 3 year time frames and just keep rolling them.

    I'm new to this so I have questions. Harder to be confident when bonds are all new to me.

    The choices for tax reasons are a bit different here in Canada than I thought. Pref shares are best outside of my retirement accounts due to favourable tax treatment.

    Thanks, Brian

    ReplyDelete
  4. Jobs: The government reported that 235K jobs were added in February. Hourly pay increased $.06 per hour or .2% and was up 2.8% Y-O-Y.

    https://www.bls.gov/news.release/empsit.nr0.htm

    The U-6 number declined to 9.2% from 9.4%.

    https://www.bls.gov/news.release/empsit.t15.htm

    The FED will raise the FF rate by .25% next week.

    With a tightening in the labor market and other recent economic data, the odds of three .25% FF increases this year have increased to over 50% IMO.

    http://www.cmegroup.com/trading/interest-rates/countdown-to-fomc.html

    The probability of 4 increases during this year, while still low, is rising too. The CME tool has the odds of 4 currently at 24.1%. That tool has the odds of a second .25% increase at close to 50% on or before the June meeting and at 72.8% on or before the September meeting.

    ReplyDelete
  5. hi Southgent,

    I know you are extremely worried about the high Cape P/E ratios and all the hype and problems surrounding taxes, tariffs, infrastructure.


    I wondered what level of GDP growth would take to justify these lofty PEs.

    Someone just mentioned that the cape P/E ratio has gone above the 1999–2000 level

    that was a time when there was the value correction.

    Here is a little video on Paul Krugman's view of a 3% growth rate.

    Thanks for your opinion

    https://in.finance.yahoo.com/video/economist-paul-krugman-doesnt-see-213928215.html

    ReplyDelete
    Replies
    1. Sam: Krugman is referring to real GDP growth which is nominal growth adjusted for inflation.

      It is conceivable that U.S. real GDP could exceed 3% in a year but that is more likely to happen after a week annual number and with major amounts of fiscal stimulus.

      I did mention here a few days ago that the Shiller Cape 10 P/E crossed 30 which it has done only twice in history. The first time was in 1929 and the other was in 1999-2000.

      https://dqydj.com/shiller-pe-cape-ratio-calculator/

      Factors supporting an expansion in multiples are likely to end soon. The first is abnormally low interest rates and inflation in the U.S.

      High quality bond yields will become more competitive with stock earnings yields. I am see that everyday when I look at high quality corporate bonds.

      The second is that the FED is unlikely to be supportive of stock prices through extremely easy monetary policies. Besides raising the FF rate gradually to more normal levels, the FED may also opt to start selling some bonds and mortgage backed securities that it acquired during its QE programs.

      The ECB may also be winding down its QE program soon. The German ten year has been spiking up in yield this week. rising from a .32% yield last Wednesday to .5% now.

      http://www.marketwatch.com/investing/bond/tmbmkde-10y?countrycode=bx

      I certainly have my doubts that Trump will be able to deliver on stimulus plans that will have a meaningful impact on growth.

      I have been discussing those reservations in my blogs and comments.

      The linchpin for the corporate tax reduction to 20% is the border tax and it looks dead in the water.

      https://www.bloomberg.com/news/articles/2017-03-09/a-key-part-of-the-gop-s-plan-to-overhaul-the-tax-code-is-in-deep-trouble


      I have also discussed in a recent post that a lot of corporate tax savings through a reduction in marginal rates will not be spent to create jobs and economic growth, assuming that actually happens.

      Instead, publicly traded corporations will use a large chunk to buy back stock, increase dividends and increase compensation packages for senior management.

      https://tennesseeindependent.blogspot.com/2017/02/trump-and-upcoming-phenomenal-tax-cut.html

      My thinking is that stock investors have become too ebullient about growth prospects. But they can remain in that too optimistic state for an extended period until a veritable river of cold hard facts douse their expectations.

      Delete
  6. I have published a new post:

    https://tennesseeindependent.blogspot.com/2017/03/observations-and-sample-of-recent_10.html

    ReplyDelete