Structure not stock selection is what counts. I’ve sold down to a 25% long portfolio with the rest mainly in 10-year and 30-year Treasuries. I won’t own high yield corporates because I fear the business cycle leaves them much too vulnerable.  Even more critical is the price-earnings multiplier for the market. We still are in the high teens while growth stocks sell at 1.5 to 2 times market’s valuation. That level of valuation should be reserved for when earnings growth runs in

From experience, any price-earnings ratio over 20 is suspect. During corrections, stocks like Tesla and Google could contract 25 to 30% with no change in their fundamentals. Historically speaking, growth-at-any-price was a disaster in the 1973-’74 market correction based on poor fundamentals for many growth stocks.  Contrapuntally, the art market foolishly gave away the greatest pieces of the centuries as late as the 1950s. Van Gogh’s “Olive Trees” had to be bought in at £4,0

I watched Goldman Sachs shed 69 points, some 8% overnight. Then, there's American Express, normally a polite growth stock among the financials, giving up 26 points, nearly 9 %. All this wipe-out while the S&P 500 Index itself just down fractionally, 0.4% shrinkage. There’s Eli Lilly actually up nearly 30 points or 3%. There was money for oils but financials like Morgan Stanley flopped 7%.  All such bloodletting keeps me invested in the low thirties and I bought more 30-year T

Magnificence, like the size of a fortune, is a comparative thing. Booth Tarkington in his classic novel “ The Magnificent Ambersons” posed the idea that to make a fortune while others are losing fortunes is the ultimate success story, bar none.  In reviewing quarterly investment reports from filed 401k’s I keep in mind the name of the game is making money while doing better than everyone else ranging up to trillion dollar money pools that rarely excel, but like “Ole Man River

When I see airlines like United tacking on 5 points a day while prime growth stocks like Microsoft slip a dozen points overnight, I shudder then add to my Boeing position. At one point 10 percent of my assets rested in Boeing. Microsoft can bunch together plenty of sinking spills, too. Same for Eli Lilly and IBM.  The conceit of playing a Nifty Fifty list rests shattered along with buying half a dozen prime growthies. They no longer exist. Eli Lilly does shed a dozen points i

After Microsoft’s haircut, some 55 points, I wondered if the old “buy ‘n hold” formula of investing still worked. Long ago, I owned American Express after it sustained the client swindle in salad oil. Buffett held on for 50 years and AXP made him super rich. I held on only for a couple of years. Just a good trade, not a mind- blowing cha-cha-cha. Early 1960s, I cottoned onto Polaroid and Xerox which made me comfortable. I loved these managements for super productive research

Microsoft sold down 48 points on its earnings release, a big surprise. Growth in its cloud division slowed unexpectedly.  Nobody ever promised a rose garden would bloom and light up my day. I’ve dealt more often with garbage men who rattled up a storm with my refuse cans.  You’re not supposed to fall head over heels for a stock because its middle name could be Disappointment. Maybe Apple or Microsoft can carry you for a couple or years, but sooner or later they do disappoint.

I got excited about jet aircraft more than 70 years ago. Actually, I lost my hearing jumping out of an aircraft during the Korean War. That was an early fifties experience. Nobody won. Just a “cease fire” in 1953 that is still in place. As a young analyst in the fifties, I called Boeing’s chief financial officer to arrange a visit to their Renton factory. They issued me a bicycle and I was free to tour the factory’s floor where they were assembling 707’s. A huddle of mechanic

Trump’s chop to American Express on limiting their card interest rate to 10% initially clipped it for a dozen or so points. But, no general market relapse on the Big Board emerged and AXP rallied some.  Meanwhile, the constant jostling of crossed swords between Trump and the  FRB goes on with no end in sight. Presidents invariably press for easement from the FRB who normally gets its way to fight inflation. I found courage to buy more AmEx, as for other tech houses,  I found

Portfolios can always be a surprise in terms of stock selection and their market weighting. First, lemme say I own Berkshire for what’s largely static,  70 percent resting in Apple, American Express, Bank of America and Coca-Cola. Some 60% of invested assets here, Apple is at 22% of investments followed by American Express at 18%.  This is a largely live-by-the-sword, die-by-the-sword investment construct.  I’ve reached it at times, too. But don’t boast about it. Sooner or la

1950s, I was a slow-poke in accumulating abstract expressionist art works. NYC was rocking as the center of this new movement, not Paris or London. I missed the reflowering of Renaissance work, too.  Rembrandt, Renoir, Matisse et al. But I own Matisse watercolors rather than the huge florals that you see in the Paris museums.  The art world thrives with or without you. You can catch up with work a hundred years old.  I did purchase a Rouault aquatint of Christ, “Veronica’s Ve

If wrong on Goldie, I’ll wear a dunce cap filled with humility. Best defense is a strong offense. Let someone else own airlines when traffic turns south.  I can offer you half a dozen stocks that do go against the grain. I’m talking properties like Berkshire, Citigroup, Amazon and Goldman Sachs. Throw in my Macy’s, spec for your retailing comeback. Sometimes,  you play with fire. Not just Macy’s.  Try a low priced airline, maybe American.  I’m not interested in pricey paper b

The amplitude of 12-month price changes range above 100% for stocks like Citigroup, Macy’s and Amazon.  MS 174.94 AAPL 277.169 AMZN 258.161 Price ranges do exceed 100 points for stocks like Amazon and Apple with large percentage changes for Morgan Stanley and Microsoft, too. A busy setting.  In many stocks we own,  price spreads do exceed 100 points. I’m thinking of Amazon, Apple, as well as financials like Morgan Stanley. Low priced Macy’s remains a cheap play on retailing r

Stocks ending in 1930 were dropped by one-third. A year later, the great fade away covered half of the country’s financial assets.  The Great Depression started in 1931, my year of birth. By then, the market tracked 20% below its low point of 1929. Then, by 1932 we  finally bottomed some 80% below the peak.  Nobody cared or jumped out windows. Born in August of 1931, I had as yet no reference points for good markets, bad ones or indifferent settings.  During the thirties, my

Way back, I bought an apartment in Trump Towers. It was early on. The Sosnoffs were sole occupants in the building. You never want to be the sole, early occupant in a new building. It takes time for the heated water to build up so you can take a hot bath. In short, a lot can go wrong that takes time to fix.  I was going for control of Caesars World,  New Jersey which turned out to be a costly mistake. Trump, later, got financing from Merrill Lynch to build a humongous casino

I know how to track this rock song which dates itself, but say at least 60 years. I remember guitars and banjos strumming away as the lyrics belted out pure optimism. It 's like the sun rising in the sky like a red rubber, bouncing ball. Sundays, visiting Washington Square Park, you'd hear a dozen groups reaching for a place in the sun with our rapt attention loyal for at least 10 minutes. The title of this piece, is a celebration of singing about your belief in yourself an

When I picked out “1929”,  Andrew Ross Sorkin’s long tome, I hoped to understand how a coterie of bankers,  brokers methodically raped our country’s financial system. These were mainly waspy, middle-aged operators and heads of toney brokerage houses. Before investing in bank stocks, catch some flavor of what happened to our financial system in 1929 and who bears the blame. Was it the man in the street overreaching with his trades or was something more systemic percolating?  L

The concept of averaging down in the market or on a specific stock you carry was probably coined by economists who can lose you serious capital. Try averaging up in your winning picks. If Goldman Sachs or Apple are bouncy pieces of paper, chances are there’s a good reason for such buoyancy.  My rule in the market is never go out to lunch. At least be at your desk when your overweighted holdings drop a bunch of points or bounce as much. Look out United Airlines just posted a 9

Daily, at the close, I check the action in Tesla. It can trade over 100 million shares up or down. TSLA has a chance of taking its shareholders to the moon, but without me.  I've had a hard enough time figuring out whether I should buy bunches of Treasuries, 10 to 30 years out. Anyone who’s bullish has to show me why President Trump can be a bullish force. Where is his punch bowl? I read Trump as a destroyer of equity value and a negative force in the flow of business. He’s u

One recent day, in its opening hour, Tesla traded down 20 points on 50 million shares. Players long Tesla know their road is rocky,...