Will there be a recession in the future?  Yes, but not like any recession in the past and here is why. 

In my hometown of about 2000 or so there remains one building that was constructed with what is known as WPA funds....or Work Progress Administration....during the Great Depression when millions where out of work the federal government set up the WPA to pay to employ those millions out of work to construct needed assets in towns across the country....such as in my small hometown a water tank, a agriculture building, and the still standing Community Building.  Note I said PAY people to work, not give them money just for existing. 

Since that time and in the last 2 decades Americans how become more and more hooked on government bailing them out of recessions and of late now weather disasters no matter how small and unlike people in the Great Depression who were ashamed to take money for nothing... now people demand such and have no shame.  All this is to point out how far we have come in this country wealth wise.  The fact government provides so much as demanded by the voters allows for enormous discretionary spending since no one is concerned about having food, having medical care, and most of whatever have become everyday needs and now even wants. 

Today one in about 8 households depending on your source is a millionaire household.  We told others some years ago that by 2030 close to half all American households would be millionaire households and we are well onto that happening.  Wealth among the Gen X generation is much due to the fact these people came of age in a hard tough time and many were latch key kids since most mothers for the first time in American history were employed.  These Gen X folks grew up to understand depending on themselves was the only route to go and began using 401k/IRA's early in life and the buildup over 20 plus years has resulted in lots of retirement funds millionaires.  Boomers many of who did not have pensions similarly had some decades to build up assets and their retirees are the largest source of mass affluent households.  The Millennial Generation started saving early have rode the wave of a stock market boom in the early 2020's and of course inflation many register as mass affluent as well or having several hundred thousand dollars in retirement funds.  For reference here the next step up from millionaire is known as Penta-millionaire or having $5 million in household assets....about 1 in 70 households register that class....so lets say Penta has replaced millionaire in this country for a economic status symbol. 

So going forward what we have is lots of households with assets and government backing that up with making sure anyone...not just the less well off....have basic needs covered during economic downturns.  

Now I have been in the working class since the early 1970's and will say since that time only one recession has not been caused by government screwing up the market economy.  The 2000 recession was caused by a huge bubble in dot com stocks and when we discovered that every stock would not be a winner the downturn became a recession.  Every other recession was a government caused one, savings and loan crisis, too many homes being built, Covid foolishness, high interest rates from the Fed, etc. Most recessions are due to voters wanting government to do something to protect them and of course the then every action meets a reaction that is not good. 

Thus now we got tens of millions of households that can spend and spend without regard to how it effects their household and even retirement future.  What you get from that is places like Walmart, Target, and restaurant spending without stop.  When I was growing up we were poor enough going out to eat at a restaurant was a special occasion, now it is done every day everywhere.  Consider where I live now a new restaurant opened this week where one meal would easily run up a $20 plus charge and the place was packed for days.  Women the target customer posted about the excitement of going there soon for days on social media.  Money is no object now for not only needs but also wants with most people. 

We point out all this to note as we have said for some time now we see no real recession on the horizon.  Does not matter which president is in office or who controls the legislature in your state just huge amounts of money floating around out there not only can be spend but will be spent and that keeps recessions at bay.  All be it much of that cash is free money from federal government deficits, but lots of build up wealth, lots of government support for the working and retired class, and the huge change in attitude from the 1930's to today. 

Every generation in America is living better than the just past generation and at a quickened pace too. The so called poor here are rich compared to even Europe, Japan, and China.  Politicians can prey on your empathy to spend more and sometimes tax more since many women are easy empathy targets and the continued increase in beta males are no less empathy targets.  Much of that spending is on transfer money and not capital spending money meaning it goes away quickly into already wealthy hands making the wealthy wealthier. 

Yes at some point this government largess will have to stop or at least slow down but so far not a single Congress or President is willing to do the dirty work of getting it done.  So as long as there are buyers of government debt the government spending will continue, until at some point the Fed will have to step in as it did in 2020 and buy the debt and create inflation.  Imagine the inflation when the Fed buying becomes trillions annually by printing new money.  Inflation yes, recessions do not count in it. 

 

As we have been posting for several years the stock market is reflecting a remarkable moment in the US economy.  We once again are seeing a new record S&P 500 high this past Friday.  The S&P is up about 5% this year after being up over 20% the last two years.  The re-shoring of high value manufacturing such as computer chips which has been happening since after the 2020 downturn which will go on for another 5 to 8 years, the moving of the large millennial generation now aged 20 to 43 into their best earning and spending years and will only peak in numbers in another decade, and of course the incredible technology companies in this country continue to generate higher profits and huge cash flows, make for a stock market that even with the ever so often downturns just keeps going up. These downturns tend to be emotional burps that when examined by rational investors gets turned around rather quickly.  So it has been with the latest burp the tariffs. Adding in one more time the current US economy with such tailwinds which started shortly after the 2008 financial crisis is little effected by who is sitting in the Oval Office and even in Congress.  All be it the red states are doing much better than the blue states in forward economic growth. 

We have been pounding the table for a decade to get into this market and stay in the market.  We did suggest during the Biden years to take a side bet in oil and gas which offered up some enticing profits, but now that Trump is in office we advised and did so ourselves to sell all such investments since higher production means lower prices and lower profits for energy companies.   Right now we see similar investment opportunities going forward with emphasis again on a Index 500 fund and for the next few months or so a side bet on banks.   We bought First Citizens back about two months ago sensing a change in bank regulation from the feds and sure enough that is about to happen and FCNCA is up about $250 a share from our buy price in that time and we still think it has several hundred dollars to go there.  Long term there is simply no better way to achieve wealth growth than allowing the ten largest companies in the market now all valued at $1 trillion dollars or more to make you one of the now growing at about 1000 per day millionaires in the US especially if you are young and investing with every paycheck and letting those big cap companies compound your investment over and over.  They are literally compounding growth machines with billions of cash on the balance sheet and now AI making them even more opportunistic going forward. 

Despite all the troubles and issues you hear about daily you are blessed to live in the best place ever on planet earth at the best time to date and with the best opportunity to join the mass affluent economic class too.  What a glorious time to be free.  

 Stock Investing. One. Last. Time. 

We have been doing this investing and  trading game for now over 45 years.  We have had a real loss..not a paper loss.. more in one day than most people lose in a lifetime of owning securities. Mistakes you bet, lots of them.  We likely read more financial news in one day than most everyone reading this do in a month or more.  We are selling nothing and only offer advice from those years of experience so with that noted here goes.  Learn from our mistakes. 

Dividends from owning stocks is nice, especially if you need the income to pay your current bills either while working or retired.  However stocks that pay dividends are not the best path to wealth accumulation.  The recent 6 months is an example of exactly that.  Maybe, just maybe, owning stocks without dividends and selling the capital gains for income produces more income and the same taxation. 

What has been tagged of late as the Magnificent 7... are seven mega-cap stocks that have run up in value more than 30% the last 6 months.  The recent 20% plus move up by The S&P 500 Index was lead by those 7 stocks as that index is market cap weighted meaning the larger the market cap the bigger share of the index they occupy.  Apple, Microsoft, Alphabet, Amazon, Nividia, Tesla, and Meta have used the panicdemic to trim thousands of employees, cut costs, and now are literally printing cash for their shareholders.  Simply put these are companies which reinvest in their company and do stock buybacks as opposed to paying out dividends and are compounding wealth creators. Only two of these stocks pay dividends and the yields are so low they are meaningless.  The choice here is rather simple own a dividend paying stock yielding 5%, maybe a money market fund paying 5%, OR own a company that has a stock value run up 30% in 6 months....again...and again...and again...over decades plus.  As Warren Buffet notes the stock market is a vehicle that transfers assets from the impatient to the patient.  A dividend stock paying 5% with little or even no appreciation of value since they are paying out earnings in dividends would take 12 years to equal what one could have gotten owning the Magnificent 7 for the last six months.  The S&P 500 comparison would be 8 years to equal.  Patience indeed. 

So the bottom line here is simple own companies that grow faster than the economy by reinvesting profits and doing smart stock buybacks. Berkshire Hathaway for example is at an all time high and still going up as investors see the profits there reinvested by Warren Buffet's team.  Think you are smart enough to reinvest your own dividends?  Maybe so...but smarter than Warren Buffet's team at reinvesting profits?  Not likely. 

We personally have stayed nearly fully invested for years without going to cash.  We remain 80% invested in stock funds, mostly the S&P 500 Index/Berkshire Hathaway with another 10% in an energy ETF.  Cash invested in Money Market funds some less than 10% on hand for dry powder if needed but more likely for large ticket items since we are retired now 15 years next month.  Bonds in this environment or almost any environment are subject to Fed raising rates reducing their value and no compounding via reinvesting profits so simply avoid bonds.  We suggested over 6 months ago that the economic recession everyone was expecting was in our opinion not happening.  We suggested that the economic troubles brought on by Biden policies was less trouble than many believed them to be as the ridiculous federal spending was mostly about paying rent seekers who they would take that money and invest in America and Mexico,  and not China. That interest rates at 5% or so are not high, but well, normal.  What we did highly suggest was that the significant reshoring of manufacturing and services from China back to the US and North America plus the moving into the best earning and spending years of their lifecycle of the large millennial generation now entering their forties was a huge plus for businesses that sells to them and owning shares of those businesses was smart.  If you live in a boom area as we do like The Triangle NC the economic wealth being created and spent by the in demand Generation X management people in the mid 40's and 50's and up and coming Millennial generation is something to behold.  We are bullish on the American economy.  We do not see the above economic trends ending anytime before the mid 2030s.

Thus the stock market run up of late is now reflecting those economic realities noted above.  The forward PE of the S&P 500 is about 20, which is somewhat rich, but not as so rich to cause real concern of something like a crash.  Will there be a pullback at some point?  You can bet on it and smart investors will use that opportunity to deploy cash.  One more time buying individual stocks is like throwing darts at a dartboard and hoping you pick right.  Buying a basket of stocks means you take no risk at your future wealth creation.  The S&P 500 and/or Berkshire Hathaway is the way to go here, with some energy on the side.  Do the most you can investing into your 401k.  Do a Roth IRA outside work.  The amount you invest is not nearly as important as the amount of time you invest.  Compounding over time is your friend. Be a balance sheet investor, not a profit and loss investor. 

Ignore the economic doomsters, ignore the gold bugs, ignore the fiat currency fools, and ignore the political doomsters too, invest for YOUR long term.  If it does not have cash flow it needs to go. Investing in America going on 248 years through a Depression, a World War, a Civil War, and numerous recessions has been a big winning bet.  I only wish I was young enough to have another decade or two to be invested.  Sitting in my office chair early each morning thinking millions of Americans are getting up, going to work, and producing good, services, and profits at companies that they sell to others where I am partner owner and I get to share those profits is nice indeed.  Owning the S&P 500 and Berkshire means my biggest decision each morning is what to order when I head down to my local Bojangles, not if I picked the right stock or missed out on some higher interest rate CD. It Beats directly owning a business, directly owning real estate, since it is so much easier and at some point should help you to sit home in your office chair too and only have to decide on what's for breakfast. 

Often wrong, but Never in Doubt.

Some thoughts on the economy and market this morning...read this with the knowledge I bought my first security in 1979...so after 42 years of investing I am often wrong but I am never in doubt.

If anyone had doubts the recent government price index reports have confirmed inflation is running hot. An annualized 6.2% harkens back to the 1970's when there was double digit inflation. Much of that caused by the oil embargo and readjusting of the dollar to being delinked from gold and thus what is called the petrodollar. That petrodollar over time has been overtaken by the mass credit market, but that is a story for another time. This time around it is more about the Fed buying trillions of dollar assets and of course massive and growing spending by Congress and Biden. Frankly if Manchin does not put an end the current BBB bill inflation is likely to see double digits again. My bet is on something passing and inflation ramping up higher. (Understand Biden and Pelosi see themselves as the current reincarnation of FDR and believe they have a date with destiny regarding increasing federal government size and control over Americans. One more time if you have not read Generations and Fourth Turning by Strauss and Howe at least read the Wikipeida cliffnotes version as every politician in DC has read it and see themselves as part of the theory which is playing out right now. My use of 1940's here is in part because of generational thinking.) I use the 1970's as a focal point since many reading this post will remember those inflationary times, but the truth is this round of inflation is more suited to comparisons to the 1940's. The 1940's as now the federal government spent with abandon and the federal reserve kept interest rates low. Note I said INTEREST rates low, not INFLATION rates low, and that is the key to this time and how you spend and invest. Thinking like Ron Paul or some other doomsday forecasters all of who predicted one of the last dozen market crashes is not in order here, nor is investing like them. That will either keep you poor or make you poor via inflation.
Do the old rules of how to value the market like, PE ratios, earnings, and book value matter in this new market? Does out of control spending and federal reserve printing dollars matter to this market? The short answer is no. The real long answer is yes. Point here is trailing PE ratios are utterly ridiculous at over 30, forward PE is in the low 20's which is also high but ridiculous. If, and that is a BIG IF, the economy keeps growing even slowly and government largess keeps being pumped into the system that money will be spent and it will end up in the profit margins of businesses selling the goods and service and lots of that profit will push down PE ratios and push up stock prices. As always government largess enriches the already rich and does little long term for the middle class or poor other than make them slaves on the government plantation. There is also the fact many of these rich own millions in government bonds in essence owning in part or in business with the federal government that keeps sending them more wealth. It is a vicious cycle, but the elites in government, the press, and business enjoy and prosper handsomely the relationship.

Let me be clear we will NOT have a market crash as some are convinced will happen. The federal reserve has become the be all to both the Congressional out of control spending and the need to keep interest rates low since all the federal debt piling up can not be serviced at even one percent interest anymore, much less a real market rate interest rate of say 3% plus on treasuries. Also note even with all government spending we still are only spending 40% plus of annual production of America, none of the vast pool of savings and assets Americans own. Is it eroding the value of your savings and assets absolutely, but wealth gain is still happening only at a must slower pace of around 2% instead of say 5% annually.

If you own treasuries, including those TIPS, it must suck to be you. Besides the fact they are doing at best only keeping up with inflation and e no real return, your bond capital loses value each day. While the federal reserve keeps interest rates down they are allowing all be it with a wink and a nod inflation to do whatever it pleases. Government borrowing at less than 1% interest cost and inflation 6% and above is good for government inflating it's way out of it's current debt and making your bond and saving account dollars worth less and less. Note holding gold and crypto here is useless too since trust me if crypto gets serious use as an exchange the US will do what China has already done and clamp down on it hard. Gold is as I have opined since forever a non cash flow producing asset so holding it has no value for those who need money to live on. Gold since this round of inflation has commenced has LOST 2% of value. If you going to be able to compete with those slackers who are getting free money each month from the federal government you got to outbid them for the limited goods and services available from the provider. You do that like the rich folks with wealth accumulation.

One more time this market or economy crashing again it is not going to happen. Think of the money printing this way. Just producing more money to buy more goods does not produce more goods. It will make those goods that are produced more expensive by increasing the money chasing the goods produced. So for those producing those goods that means higher profits. Thus money printed means in essence money being handed out to the non producers or poorer workers who spend it into producer hands making them wealthier. Owning part of those producers business via stocks means you get to share in the profits. For those who say it will erode the economy that is true to a lesser extent than the money can only buy what is produced and taxed from the producers. So what is happening is the federal government is taking more of the current production of Americans and can only take 100%, but in this case all government is taking about 45% of all production, which might be the highest percentage ever. We do not get poorer overall, just lots of inefficient spending. The one item getting trashed in the dollar as the reserve currency. Do note here most of the red states are actually legislating tax cuts and holding government spending in line with inflation, which means more and more of government spending is going on in Washington.

Now one can pretty up this current economy and market all they want to regarding inflation, interest rates, valuations, and the like, but the deal here is until the current political and monetary actors in charge decide to do differently the only way to prosper is to play by THEIR rules and not the time honored rules. Right now the game is Modern Monetary Theory and if you do not know what that is go Google it and I will wait here. Lots of free money just washing around out there being spent many times by those with no idea of the value of work to money since they do not work and see no reason in doing such. You as an investor can take advantage of such of course. Anyone who got scared and dropped out of stocks in March 2020 has seen opportunity lost big and those who stayed in have been well rewarded literally more than doubling their assets in less than one year. Frankly yours truly stayed in for the most part, but wish I had put both feet in instead of just one having been scared by the dumbed down diversity hired press. I will not repeat that mistake again. Consider oil futures in April 2020 where any comer was being paid to take free oil off the market for future use by the scarecrows in our press preaching the all electric everything economy was here. But even with one foot in the market the two years have been marvelously rewarding for this long tenured investor. Going forward here I will do what I told someone else years ago regarding trading the market. You might not like the actors, the players, or the regime in control but if you want to be a part of the play you got to go by their rules. Thus I will be shortly after the new year begins be putting another 5% of assets into stocks, as I just did so about a month ago. Sorta a dollar cost averaging and watching the actors here and seeing how the economy and government spending play out over the next month and a half and on into 2022. I will no longer be waiting on a correction which will likely not come, unless we get a downturn with the first interest rate hike and that is late in 2022. Meanwhile ride this horse for more capital wealth gains.

Stocks have been and will continue to be the one place one can keep up and beat inflation going in about 250 years here in America. Even in this political mess betting against America for that same time has been a suckers bet. Businesses for profit can and do raise prices, and a profit of 10% on $100 is more profit at 10% on $110 inflated price and stock prices rise accordingly, all the while paying me a dividend from which to pay my bills. Cash flow assets make as much sense right now as they ever did. I would rather be riding with Jeff Bezos, Tim Cook, and others like them than with anyone or anything else right now. Stocks in the last 12 years have returned 19% annually, 9% annually since 2000. Nothing comes close to that return in investing. The meme stock players and millennial stock ESG players are only renting their dreams with those who see them as the latest group of suckers to be harvested for profits while those who avoid such fads are playing the better odds by putting their money with the ones in real control. Over time nothing has been able to weather out of control government spending and inflation than owning a part of a business which is owning stocks. As for stocks with so many workers retirement funds now linked to stock market appreciation imagine what will happen to politicians if the stock market sold off big time, think 2008 and we got Obama and a 60 seat Democratic Senate. These politicians understand that well.

How long will this inflation high/low interest rate scheme last? If history is a guide I give it another decade plus as it will take that long for the government to inflate their way out of the debt mess and that is assuming some no nonsense kick ass Gen X leaders take over and rights the ship soon. Meanwhile remember scared money never keeps pace with inflation and never wins the wealth accumulation game either.

So what is this investor buying? Much of the same that got us here. VOO...Vanguard S&P 500 fund... and BRK.B Berkshire Hathaway. I would suggest the same for you if you want to not only stay rich and/or get rich in this new economic/market environment. One final word you will notice we own NO individual stock, excepting for Berkshire Hathaway and that is more an index fund itself than a stock for those needing less income and more non taxable future growth. The rest of my holdings are in cash, legacy munis which you can not buy, some aggressive growth stock funds closed to new investors, and some high yield junk bonds all dry powder. Owning individual stocks, ANY ONE Stock, is taking a high gamble here only for selected fools as the current government masters can decide any day to come after your stock with a hammer and take it down. It is their rules and you must play their game. Good luck and good investing friends.

Interest Rates in the Future

 I have long opined that interest rates this low would be here for a decade or so for reasons due to generational spending patterns and we are repeating much of the post Great Depression cycle. I revise my opinion that we will likely NEVER see interest rates much higher than 2% if that. The fiat currency crowd will laugh and say printing of money will invite huge inflation issues, the economy will get better crowd will say that higher demand for loans will push up rates, and of course the gold/bitcoin crowd will say proof of such inflation is the higher prices for their commodity and all commodities. Note the attached graph that points out commodities are in fact down over the last decade and if inflation was a worry they would be up. CPI inflation, which the fed wants at and above 2% is going nowhere as well. The point there is consumers led by a frugal millennial generation is saving, not spending, having been scared by two back to back recessions. Lets also note a factoid here that it has been shown that when interest rates go above 10% and below 4% consumer spending decreases with every basis point tick up or down, the sweet spot for consumer spending is between 4% and 10% and we will not see anything between those points for years or decades to come as I will explain here. What is going up are assets prices, led by bonds which go up when interest rates go down and frankly they have nowhere else to go. Therefore owning and buying bonds now approaches the greater fool theory in that you make near nothing on interest and no chance of any cap gains on bonds. The only bonds going up as noted on this chart are High Yield bonds where interest rate chasers are seeking any kind of yield. The risk, HIGH risk, in bonds is that at this level any move up destroys bond values. The real appreciation in value is the S&P 500 or stocks in general. This is due to the fact companies produce cash flow, unlike gold nor bitcoin, and can weather any cycle of interest rates and in the current environment actually gain value as much of the excess cash not being spent is going into stocks where cap appreciation is obvious and of course dividends are being paid. The S&P 500 alone pays 1.5% plus which is much higher than any savings account or CD and frankly safer since unlike savings and even bonds their cash flow protects one from inflation depreciation. As for interest rates in the future note the huge budget deficits we currently have which are being duplicated across the world. Note the demand for additional spending by the far left democrats and thus we will see trillion dollar deficits for as far as one can see. Much of the dollars being printed are being sucked up by the Fed onto their balance sheet and they, like Japan, are now buying private issue bonds. The fed soon will follow suit of Japan and begin buying stocks via ETF's. Japans central bank owns 85% of all ETF's in that country a staggering stat. The reason is the government needs to hold up asset prices for those depending on such for needs and retirement in a country where there is huge numbers retiring. Also Japan's debt is much larger than the US presently and they need to hold down interest rates to finance all that debt. One can likely see where I am headed and that is our fed is likely on that same path for the same reasons. Thus the point here is interest rates are likely this low forever due to the need to finance all that new spending coming via the democrat control of government and truthfully the Republicans are no better there. Might want to acquaint yourself with MMT, modern monetary theory, sooner rather later as that is the way of the democratic party now. So personally I have moved and will move before the Georgia election almost all I own into some ETF's, mostly S&P 500 index funds as thus putting my money where my mouth is so to speak. You might want to consider such yourself.

Three Retirement Portfolios one of which will work for anyone.

Having stopped trading about three months ago I began a search for a quick and simple way to deploy those now retirement assets that would provide income, safety, and near no maintenance going forward.  That search led to finding three portfolios that would fit retirement investing for those needing such. 

Let's first note in this era of very low interest rates and our thinking this period has some years to run, likely more than a decade owning bonds is deadly to principal and certainly income generation.  When interest rates do up, which they will at some point, existing bond values go down.  Therefore we did not look for anything involving bonds. Thus we settled on a stock and cash portfolio.  Below are three options that should suit any retirement investor.  We also highly suggest one avoid any fund or ETF that concentrates in any sector or tries to time the market.  

For those needing more income and less growth Vanguard's High Dividend ETF suits nicely. VYM is a broad based stock ETF , 407 holdings, with emphasis on large and growing companies who produce a steady stream of growing dividend income.  The current yield is just over 3%.  These companies rarely reduce their dividend even in recessions and raise them when business is good.  Your investment might decrease in value, but recovers nicely in economic expansions.  The stocks here are solid large cap companies that have staying power. This is an all in fund for most retirement people if one keeps a cushion of cash on the side.  The cash can be invested in the Federal Money Market Fund which offers a current 1.56% yield which is quite good in these times.  

For those wanting equal parts growth and yield Vanguard's 500 Index ETF is perfect.  VOO includes the largest 500 companies in the US and yields right at 2%.  Like the above ETF you get solid and growing yield with more emphasis on growth and less taxable income until you need it.  This is the safest ETF out there and combined with the Federal Money Market fund mentioned above will give one steady income and advancing appreciation of assets.  Most people need to be here. 

For those wanting a more tax efficient ETF Vanguard's Growth ETF is the one.  VUG again rests on large cap companies, currently 282,  with above average growth prospects and some yield, in this case right at 1%.  Combine that with the Vanguard Muni Market Fund currently yielding 1.1% federal tax free and you got long term growth and good tax efficient yield. 

No need to select some or part of these portfolios just select one and you have little concern about safety going forward and no real concerns about making changes ever.  The only reason to change would be a change in your needs to retirement. Combining one of these ETF's with Social Security and any pension should take care of your income needs and is inflation protected going forward.  

The Animal Spirits are strong in this One.

As of this summer we have been trading stocks, bonds, and options for 40 years.  Seems like just yesterday we took the dive into our first investment security which was not a CD or savings account.  The first security was a $5000 NC municipal bond which paid a then outrageous 10% plus.  Seriously it was during the huge increase in interest rates the Fed was pushing in an effort to tame inflation in the late 1970's.  Of course the bond got called in mid 1980's as rates came down but at that point we were already into stocks and options trading and never looked back.  

The animal spirits were raging in us at the time and we allowed experience and yes some big losses to teach us how to trade and how to make money doing so.  Only a very very few do trading well and trust me almost everyone who says they trade and make big money is lying and bragging.   If they do not have an even bigger retirement account than trading account they are  bragging and they are stupid on steroids.  Ask them if they are so good at trading why are they not retired from a day job and trading full time. 

After 4 decades this is our swan song as at the end of 2019 we plan on putting up our trading shoes and move on to better choices.  Eleven years ago we retired much earlier than most people could or would dare to do so.  We will at some point in the next six months wind down our account to the point there is only some long term holdings.  There might be some tag ends trades that will be needed as we move into 2020, but those will be to clean up and close some positions. 

We consider the last 40 years as a blessing as trading and investing has brought us financial security of the select few.   Using some smarts, LOTS of learning and experience over those 40 years also means we are doing something special in leaving at the top of our game.  At this point in our trading career we honestly believe we have learned most of the ins and outs of trading and investing and could make much more going forward.  But as we did eleven years ago we also have considered our mortality and wish to make the most of the years we have left on this earth.   Essentially as we noted going out on top. 

In that our final long term trading assets must be positioned for the future and we have decided in a high concentration in two stocks, which will be about 60% of our entire portfolio going forward.  Those stocks will be Amazon and JP Morgan Bank.  We see these two companies as being the safest with the most capital gains opportunities in the next decade.   We will likely throw in a smallish position in Facebook with the rest of the portfolio.  

For good measure here we will reveal our final trading portfolio stocks for the final six months.  All we consider good choice for traders and individual stock buyers going forward.   Amazon, JP Morgan, Facebook, Apple, AT&T, Verizon, Wells Fargo, and Walmart.  We also currently hold Google and we will likely drop Google shortly due to slower growth over valuation.   If one is looking a good dividend portfolio going forward, JP Morgan, and especially Wells Fargo are good values here.  One we do not hold Dominion Energy would be a good dividend addition as well.  AT&T and Verizon are fairly valued and good dividend stocks as well.  Apple is concerning right now. Walmart a steady eddie.   Amazon is easily the best choice for future growth and JP Morgan is the bluest of blue chips and pays a nice and increasing dividend.  Facebook the best of breed for consumer growth here. 

We will likely continue to post on our blog from time to time, but most about investing, not trading.  If you have questions still feel free to message us as many of you do as I will always be alert to market conditions and the economy since even not trading as Warren Buffet has suggested the best portfolio going forward is a high concentration in the S&P 500 index and some cash.  The only question now is can we keep the animal spirits in check after January 2020 as the it is strong in this one.