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(B)(N) Sweet Sixteen & Getting Older Fast

August 23, 2015
Sweet Sixteen 4 By 4

Sweet Sixteen 4 By 4

Drama. There’s a lot of cant “knowledge” about investing on Wall Street akin to the sanctimony of Also sprach Zarathustra, Friedrich Nietzsche, 1883 and also in the best schools at the graduate level and that’s intimidating and that’s all there is (they say) and it looks exactly like a “square dance” – we all know our partners and what we have to do and it’s best that we do it – but to us (alas) it’s nothing more than the “dozy dough” (the lazy money) and they can’t actually prove anything of what they say because it’s not true and we’re going to tell you why (dear) and why you’re still in the “middle class” and how to prosper while you’re still in the “middle class” because having lots of “money” and being “wealthy” is overrated and there’s a much better way to get it and keep it than to rely on the dozy dough to bring us home when the music stops and the dance is over.

We’ve looked at this before (please see the recent “(B)(N) What’s A Girl To Do” for another example) and there’s no reason for us to look at again because the message is very simple – to make money, don’t lose it – and even the legendary Yogi Berra, a true paragon of truth and brevity hard learned from a life of catching curves, floaters, and fast balls, might cringe at that but that’s all there is to it and there isn’t anything else (except gambling for it – a wild pitch, so to speak) and there are only two parts to that equation: an investment requires 100% capital safety and if it doesn’t have that, it’s not an investment, and secondly, it requires a hopeful but not necessarily guaranteed return above the rate of inflation which if we don’t get it is just another way of losing our money.

And if you’re just sixteen and you know that, then the World is your oyster. Trust me.

The Truth

The Truth

But Wall Street doesn’t tell us that because it’s better for their business to make it “complicated” and “risky” and to look for “patterns” in everything while they’re searching for the truth.

But the truth is that we want 100% capital safety and a hopeful but not necessarily guaranteed return above the rate of inflation and we looked up one of their gurus to give us sixteen stocks that are not likely to lose value and pay some dividends in the next few years and which might not crash so much with the coming crash.

And they gave us their best shot but we don’t like it and we ran this portfolio through our (B)-class machine to fix it and there are millions of portfolios just like it and some are even better (less worse, please see below) and we can “fix” any of them and get what we want – we want 100% capital safety and a hopeful but not necessarily guaranteed return above the rate of inflation.

The Real Truth

The Real Truth

But the portfolio that we’re going talk about today is among the worst portfolios that we have ever seen for anybody let alone the long term buy and hold investor who hopes for capital safety, some dividends, and a hopeful return on their investment for whom it was crafted; we’d have to really work at it with malice to create a worse portfolio and that’s hard to do in the Dows and the S&P 100 or 500 and the NASDAQ 100 and in almost any World market, but it’s easier to get outside of those markets – and that’s what they did and they did it for reasons that have nothing to do with the safety of our money and we call that a crime but nobody is going to pay for that crime but you, dear, the dear investor who is just sixteen and getting older fast; please see Exhibit 1 below (and click on it and again to make it larger as required).

Exhibit 1: (B)(N) Sweet Sixteen & Getting Older Fast

Figure 1.1: (B)(N) Sweet Sixteen & Getting Older Fast

Figure 1.1: (B)(N) Sweet Sixteen & Getting Older Fast

For more information and examples of the Free Market Yield and the terms that we have used above, please see our Posts “(P&I) The Dismal Equation (Ecclesiastes 9:1)” and “(B)(N) S&P 100 Volatility Risk and The Full Moon” and “(B)(N) NASDAQ 100 Volatility and The Stone Bunnies“ and for an introduction to The Barometer “(B)(N) What’s A Girl To Do” or “(P&I) The Swiss Franc Debacle“.

And for more information on real “risk management” in modern times and additional references to the theory and how to read the charts and tables, please see our Post, The RiskWerk Company Glossary and “(P&I) Dividend Risk and Dividend Yield“, and our recent Posts “(P&I) The Profit Box” and “(P&I) The Process – In The Beginning“; and we’ve also profiled hundreds of companies in these Posts and the Search Box (upper right) might help you to find what you’re looking for, such as “(B)(N) TLM Talisman Energy Incorporated” or “(B)(N) ATHN AthenaHealth Incorporated” or “(B)(N) PETM PetSmart Incorporated“, to name just a few.

And for more applications of these concepts please see our Posts which rely on the Theory of the Firm developed by the author (Goetze 2006) which calibrates The Process to the units of the balance sheet and demonstrates the price of risk as the solution to a Nash Equilibrium between “risk-seeking” and “risk-averse” investors within the demonstrated societal norms of risk aversion and bargaining practice. And for more on The Process, please see our Posts The Food Chain and The Process End-Of-Process.

And for more on what risk averse investing has done for us this year, please see our recent Posts on “(P&I) The Easy (EC) Theory of the Capital Markets” or “(B)(N) The Easy (EC) Theory of the S&P 500“, and the past, The S&P TSX “Hangdog” Market or The Wall Street Put or specialty markets such as The Dow Transports & Utilities or (B)(N) The Woods Are Burning, or for the real class actionLa Dolce Vita – Let’s Do Prada! and It’s For You, Dear on the smartphone business.

And for more stocks at high prices, The World’s Most Talked About Stocks or Earnings Don’t Matter – NASDAQ 100. And for more on what’s Working in AmericaBig OilShopping in America or Banking in America, to name just a few.

Postscript

We are The RiskWerk Company and care not a jot for mutual funds, hedge funds, “alternative investments”, the “risk/reward equation” and every other unprovable artifact of investment lore. We have just one product

The Perpetual Bond
Alpha-smart with 100% Capital Safety and 100% Liquidity
Guaranteed
With No Fees and No Loads on Capital

For more information on RiskWerk, please follow the Tags or Categories attached to this Letter or simply enter Search for additional references to any term that we have used. Related data may be obtained from us for free in a machine readable format by request to RiskWerk@gmail.com.

Disclaimer

Investing in the bond and stock markets has become a highly regulated and litigious industry but despite that, there remains only one effective rule and that is caveat emptor or “buyer beware”. Nothing that we say should be construed by any person as advice or a recommendation to buy, sell, hold or avoid the common stock or bonds of any public company at any time for any purpose. That is the law and we fully support and respect that law and regulation in every jurisdiction without exception and without qualification to the best of our knowledge and ability. We can only tell you what we do and why we do it or have done it and we know nothing at all about the future or the future of stock prices of any company nor why they are what they are now. The author retains all copyrights to his works in this blog and on this website. The Perpetual Bond®™ is a registered trademark and patented technology of The RiskWerk Company and RiskWerk Limited (“Company”) . The Canada Pension Bond®™ and The Medina Bond®™ are registered trademarks or trademarks of the Company as are the words and phrases “Alpha-smart”, “100% Capital Safety”, “100% Liquidity”, ”price of risk”, “risk price”, and the symbols “(B)”, “(N)” and N*.

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