BAGAKOAA; October 17, 2012 Our House Is A Very Very Very Fine House

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October/2012

Hey I almost felt retired today and I liked it.  Ok I had to ignore the guys in the back yard and the dogs barking next door and a few phone calls, but I actually got to have a cup of tea, read the WSJ and IBD and take care of a lot of portfolio issues I have ignored for the last several weeks.

 

Later in the day, I got to bring Man Child to his workout.  While waiting for Jack, I was listening to XM Sirius Radio and the song "Our House" came on.  I am sure all of you must have heard the big hit by Crosby Stills and Nash circa 1970ish.  The lyrics really annoyed me.

 

"Our house is a very very very fine house.

With two cats in the yard.

Life used to be so hard.

Now everything is easy cause of you."

 

Ok, I gotta know who puts cats in a yard?  Really.  No one puts cats in a yard.  Maybe Sigfried and Roy, but we all know how that turned out.  Come on cats in a yard.  Cats won't stay in a yard.  You let a cat go in a yard and he is gone.  Up the wall over the wall in some other fools yard. 

 

We have enough trouble finding two cats in a room none the less a yard.  Can you imagine that.  Devin would say to me, "Bring in the two cats in the yard."  There goes two hours of my life.  Heck it is annoying enough when she just yells down stairs, "Where are the cats?" 

 

Ok I never know where the darn cats are so I have two choices, I get up and begin to look for the three cats or make up an answer.  "Oh hun, Jethro is under the guest bed and the other two are in Jack's room."  This usually works because she is just taking a survey, she usually does not really need to bear witness to their existence.

 

So come on, two cats in the yard.  Life used to be so hard.  Yeah its hard trying to round up two cats in the yard.  I got news for you, shaking the cat food box only lasts a few days, as they catch on to that in a hurry.

 

But what really annoys me about the song is they did not even need the word cats to make the lyrics work.  I will show you what I mean.

 

Our house is a very very very fine house.

With two DOGS in the yard.

Life used to be so hard.

Now everything is easy cause of you.

 

Dogs work just a good as cats and it makes a hell of a lot more sense than cats.  Really when you sing the lyrics with cats, not one really pictures two cats.  Two black cats, calicos, Burmese, abysinians, yeah now you are picturing cats, but just cats in a yard and your mind goes blank because you hardly ever see two cats lounging around the yard.  

 

Don't get me wrong, about a week ago I saw a cat in a yard in the neighborhood, but it was sneaking and worming its way around some bushes.

 

Now I say two dogs in a yard, you are going to think of your favorite childhood canine and another dog if you were pet deprived.  You can see the dogs and the dogs are laying in the yard.  If you have vast experiences with dogs as we do you might visualize them running in the yard and chasing a Frisbee (OOOPPPS Jaycee just looked up when I typed that. She loves Frisbee).  I can see them laying across the grass.  I can see them defecating in the grass.  I can see Jaycee wiping her hiney on the grass.

 

Ok I went a little too far, but you get the idea.  So I think, when we hear that iconic song forever more we all sing it with dogs instead of cats. 

 

Our house is a very very very fine house.

With two DOGS in the yard.

Life used to be so hard.

Now everything is easy cause of you.

 

Hey did you see the debate last night?  Me neither.  I know who I am voting for.  So a "binder full of women"?  That is the best social networking and the media can take away from the debate?  Weak.

 

Romney could have suggested he wished he had more women to throw under the bus as just a few hours before the debate Hilary took the heat for not having enough security in our embassy and Susan Rice took the hit for poor intel?  Who is their boss?   

 

Ok the clang of swords over pensions got a little airplay.  When President Obama was challenged about his Pension, he quickly came back with a comment implying it was not as good as Romney's.  Mr. President, he does not have a tax payer funded pension.  Mitt, he teed it up for you and you could have hit it out of the park.

 

Hey I enjoyed watching the elimination round with Dancing With The Stars.  Susan Boyle and Donny Osmond (He has my email ya know) were much more entertaining than Obama and Romney.  She looked terrified to be on stage.  Bristol Palin went home, too bad, she seems like a nice kid.    

Common Sense Is Not So Common

 

French Writer, Historian, and Philosopher, François-Marie Arouet aka, Voltaire writer, (who managed to piss off a couple of kings and have an solicitous affair with his neice-common sense)is attributed with having said that first.  But I digress.

 

In one of my multitude of investment newsletters, I ran a cross some sage advice worth sharing.  We have mentioned this before, but to some new readers and those with no retention, we will remediate.

 

The three most difficult things and investor or trader (There is a difference.) must decide is what stock to buy, what price to pay for it and at what price to sell. 

 

Dr. David Eifrig of Stansberry and Associates fame reminded us today of the key elements of when to sell.  You have heard me say this on several occasions as it is preached by O'Neil of IBD fame and Mr. Cramer himself.

 

This is really easy and should be common sense.

 

Make a note of why you bought the stock.  After you have done all of your homework, and feel comfortable you have discovered value in the timeline you are considering. (Quick explanation:  As a trader, if you feel there is a good chance for a impending price bump and you discover a value that might generate a couple of percent in the next day or so, then make of note of your reasoning and do the deal.  As an Investor, you did your homework and see a value over the next 12-24 months, make a note of your reasoning.)

 

I use a simple black college compositional book.  I also use Schwab's Streetsmart.com notes attached to their charting function.  When I check the chart for any given stock, I will see a brief notation attached to the day I bought the initial postion.  It might look like this.  2012 3 Jan INTC, article in Barron's, IBD entry 22.36, stop at 20.50, 26 Q2 2013.

 

Though cryptic, I know I bought this on Jan 3 2012 as a result of a Barron's article (and homework of course), checked the IBD Marketsmith technicals for an entry point of 22.36.  Place a stop order at 20.50 (or set an alert in Schwab to notify at 20.50) and I am looking for 26.00 a share by the second quarter of 2013.  To back up that note I would look at my Black Book for Jan 3rd and see if I made more exhaustive notes on the buy.  (Oh yeah I might also check my blog for that week as I do my best to let you know when I start a position and why.)

 

Now what is important to note, is I know where I want to get out BEFORE I bought the stock.  If I hit 20.50, I will lick my wounds and find another place to loose money.  If I hit 26.00, I will take some or all the profit. 

 

Now here is the hard part that nobody including me likes to do.  At about every three to six months, look at your portfolio and ask yourself why you are holding those stocks.  In this example, say about July of 2012 I looked at INTC and saw it was up about 4.5%.  I might ask why did I buy it?  (I know where to find those answers.)  Are the reasons I bought still valid?  Would I pimp it in my blog. 

 

If my reasons are no longer valid, take the money and run.  If they are valid, make a note that you reviewed the stock and are still committed, and maybe tighten your stop or trade alert to reflect the 4.5% gain, possibly to 21.50. 

 

Hope that helps.

 

  

Salve Lucrum

 

 

 

 

 

 

 

 

Brian Ireland
 
 
Since 10/10/2012
BAGAKOAA;

I am not a professional investment advisor. Anybody reading my blog and investing accordingly must be out of their minds. I have made more money than I have lost. There are many more qualified people than I to actually tell you how to invest your money.

BAGAKOAA=Boys And Girls And Kids Of All Ages

Salve Lucrum=Latin for Hurrah for Profit.

2012 Year Ending

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S&P 500 1,358

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