Tuesday, April 18, 2017

Good Article from Dennis Prager

http://www.dennisprager.com/two-weeks-of-great-clarity/

If you prize clarity, then these past weeks were some of the best in memory.
1. When America leads, the world is better.
For the first time in eight years, the allies of America and the world’s decent people celebrated America’s return to leadership. Just about all of them understand that if the United States doesn’t exercise its power, the worst regimes on Earth will.
The left claims to care about the downtrodden of the world, but this concern is a moral fraud. The downtrodden the left most care about are American blacks, women and gays. And Palestinians. But these groups aren’t downtrodden; they are merely a vehicle by which the left attacks America and Israel to gain power. The truly downtrodden — that is, the most oppressed people in the world, such as Christians living in the Middle East, and the victims of Syrian President Bashar Assad’s tyranny — know who really cares about them: Trump and America’s conservatives.
2. The terrible presidency of Barack Obama is beginning to be acknowledged.
Following President Trump’s order to attack Syria about 63 hours after the Syrian regime seemingly used chemical weapons, even many in the mainstream media couldn’t help but contrast his prompt response with Obama’s nonresponse to Assad’s use of chemical weapons in 2013. And almost every report further noted that Obama failed to do anything after having promised that he would regard the use of chemical weapons by Assad as crossing a “red line.”
Likewise, Obama’s do-nothing policies vis-a-vis North Korea are being contrasted with Trump’s warnings to leader Kim Jung Un about further testing of intercontinental ballistic missiles and pressure on China’s leaders to rein in the North Korean regime.
These contrasts are important for a number of reasons, not the least of which being there is now hope that Obama’s star will dim as time goes on.
This will come as somewhat of a surprise to those on the left, but many of us who are not on the left believe that Obama did more damage to America than any previous president — economically, militarily and socially.
Regarding the social damage, as the first black president in American history, he could have been an unprecedented force for racial healing but instead left America more racially divided than any modern president. In his repeated citing of Ferguson, for example, he helped spread the lie that a racist white Missouri police officer had killed an innocent black teenager without reason (other than racial bias).
He deceived the American people (the “if you like your doctor, you can keep your doctor” assertion and more) in order to pass Obamacare, one of the largest government-expanding programs in American history. He used presidential power in an unprecedentedly authoritarian manner. He showed far more understanding of the Iranian theocracy than of the Israeli democracy. His Internal Revenue Service and Department of Justice were politicized in ways reminiscent of corrupt Third World regimes. And he left America fighting a (thus far nonviolent) second Civil War.
3. The interminably repeated left-wing lie that Trump and Russian President Vladimir Putin are in cahoots has exploded. With Trump’s military attack on Assad and verbal attacks on Russia, that claim has been shown to be what those with a little common sense knew it to be: a baseless, wholly made-up conspiracy theory meant to explain an election loss with which Democrats still haven’t come to grips. In fact, President Trump has shown more backbone with Russia in his first 100 days in office than President Obama did in eight years.
4. Another charge made over and over by the left — the mainstream media, academia and the Democratic Party — that the Trump election had unleashed an unprecedented amount of anti-Semitism was proven to be yet another left-wing hysteria based on a left-wing lie. It turned out that bomb threats phoned into Jewish community centers and Jewish agencies came not from Trump supporters and “white supremacists” but from a black radical and a disturbed young American Jew living in Israel.
Given that factual and moral clarity are conservatism’s greatest allies, we may be witnessing the beginning of a conservative Renaissance, the likes of which we haven’t seen since the advent of progressivism.

This column was originally posted on Townhall.com.

Monday, March 27, 2017

Adding TROW (T. Rowe Price)

I put TROW onto my watch list several months ago.  I set a target buy price of $68.  I started a 1/2 position in TROW at $67.64 today.  Morningstar rates TROW a 4 Star value, and the FASTGraph below is compelling:


TROW has a nice dividend yield of 3.4%, no debt, and has been increasing the dividend for many years.  At a PE of 14 vs. a normal PE of 20, it looks like a good bargain.  I put another buy price into my watch list at a 5% discount from today.  If it hits that in the coming weeks, I'll add more.

Best,

Chump

Wednesday, March 8, 2017

Buying KIM for the IRA, Adding KR (Kroger) to my Taxable Account

Many of my high yield holdings are down today in anticipation of an interest rate hike.  As a result, KIM (Kimco) had dipped below my target buy price.  KIM is a high end mall REIT, and somewhat impervious to the assault posed by Amazon and the internet. KIM has a nice high yield of 4.7%, and is now at a nice valuation to start a position.

Here is the FASTGraph:


I put a limit order in at $22.18, we'll see if it fills....

Regarding KR (Kroger), this stock got onto my radar due to my youngest daughter.  After opening brokerage accounts for all of my three children, they started looking at stocks.  They brainstormed stores and companies with which they did business, checked to see if publicly traded, then looked at a FASTGraph for each.

My daughter mentioned she really liked to shop at Ralph's, "they have everything."  Ralph's is owned by Kroger.  The FASTGraph for KR is shown here:


Turns out KR is big, with $115B in sales in 2016.  The valuation is good, and they've paid a growing dividend now for 10+ years.  Good pick.

Due to the yield of 1.7%, I've added it to my taxable account, where I hold stocks with lower yields for tax purposes.

That's all for now,

Chump

Thursday, February 16, 2017

Should I Buy Coke (KO)? And a Michael Lewis book recommendation.

This is a trick question, I already own KO.   I just finished an interesting book by Michael Lewis entitled "The Undoing Project:  A Friendship That Changed Our Minds.."  Mr. Lewis is the author of some really interesting titles including:
  • The Big Short
  • Liar's Poker
  • Flash Boys
  • Moneyball
  • Boomerang
  • The Blind Side
In the undoing project, he tells the story of two prominent Israeli Psychologists, Daniel Kahneman and Amos Tversky, and their work on how humans think and make decisions.

One of my takeaways is that humans aren't very good at making data driven decisions, and are influenced strongly by bias.  Among the many biases discussed, was framing.

"Should I Buy Coke," feels very different that "Should I sell Coke," but it shouldn't.   The data is the same in either direction, yet, I've owned Coke now for nearly five years, and I've grown attached to its brand, history, dividend growth, and I really don't want to sell my shares.

Yet, if you ask me whether you should invest in Coke today, I would likely tell you no; there are better opportunities out there based on today's valuation, Coke's pathetic growth, and the long term prospects of sugary drinks overall.  And while the dividend is okay, heck, you get a bigger dividend from several utilities, and they are growing faster than Coke!



Coke's stock has increased around 20% over the past 5 years, but trails the S&P 500 over that same period by a wide margin, which is pretty disappointing.

Here is the FastGraph for KO:



It's suffered four straight years of declining earnings and revenue, is moderately overpriced today, and is forecasting another 2% decline in earnings for 2017... not much to get excited about.

Thus my bias, if I know based on the data that Coke is not a great investment, and that I can name several better opportunities (SO, DUK, PFE, STAG to name a few), SO WHY DON'T I SELL?  I would never buy a stock with the fundamentals of Coke today....yet I hesitate to sell for some reason. Another concept in the book is the strength of the emotion "regret."  If I sell, and something good happens to catalyze growth at Coke, I will suffer regret, which would be much worse than if I simply stick with Coke, and nothing good ever happens.

It seems we humans prefer the slow loss of our investment over many years, or long periods of underperformance, to the threat of a sharp dose of regret.

Food for thought.

Chump









Monday, February 13, 2017

Started a Position in Pfizer (PFE)

More to come soon.  Good valuation, good dividend around 4%, good place to park some cash.

FastGraph below:


I have a larger than normal cash position in the portfolio due to the sale of three stocks in 2017, CSX, IBM, and DOV, all of which have had nice run ups since the election.

I'll look to add more to PFE if the stock drops 5% from where I bought it.....

That's all for now,

Chump

Monday, January 30, 2017

Some (much needed) Facts About President Trump's Immigration Order

Some good information from ZeroHedge:


Kellyanne Conway Rages Against "Misinformation" Over Trump's Immigration Order


Additionally, in an effort to dispel some more misinformation, Breitbart offers seven inconvenient facts about Trump's refugee actions...
1. It is NOT a “Muslim ban.” You will search the Executive Order in vain for mentions of Islam, or any other religion. By Sunday morning, the media began suffering acute attacks of honesty and writing headlines such as “Trump’s Latest Executive Order: Banning People From 7 Countries and More” (CNN) and printing the full text of the order.
Granted, CNN still slips the phrase “Muslim-majority countries” into every article about the order, including the post in which they reprinted its text in full, but CNN used the word “Muslim,” not Trump. The order applies to all citizens of Iraq, Iran, Syria, Libya, Somalia, Sudan, and Yemen. It does not specify Muslims. The indefinite hold on Syrian refugees will affect Christians and Muslims alike.
As Tim Carney at the Washington Examiner points out, the largest Muslim-majority countries in the world are not named in the Executive Order.
More countries may be added to the moratorium in the days to come, as the Secretary of Homeland Security has been instructed to complete a 30-day review of nations that don’t provide adequate information for vetting visa applicants.
It’s also noteworthy that the ban is not absolute. Exceptions for “foreign nationals traveling on diplomatic visas, North Atlantic Treaty Organization visas, C-2 visas for travel to the United Nations, and G-1, G-2, G-3, and G-4 visas” are expressly made in the order. The Departments of State and Homeland Security can also grant exceptions on a “case-by-case basis,” and “when in the national interest, issue visas or other immigration benefits to nationals of countries for which visas and benefits are otherwise blocked.”
There is a provision in the Executive Order that says applications based on religious persecution will be prioritized “provided that the religion of the individual is a minority religion in the individual’s country of nationality.”
This has been denounced as a “stealth Muslim ban” by some of the very same people who were conspicuously silent when the Obama administration pushed Christians – who the most savagely persecuted minority in the Middle East, with only the Yazidis offering real competition — to the back of the migration line.
2. The order is based on security reviews conducted by President Barack Obama’s deputies. As White House counselor Kellyanne Conway pointed out on “Fox News Sunday,” the seven nations named in Trump’s executive order are drawn from the Terrorist Prevention Act of 2015. The 2015 “Visa Waiver Program Improvement and Terrorist Travel Prevention Act of 2015” named Iraq, Iran, Sudan, and Syria, while its 2016 update added Libya, Somalia, and Yemen.
“These are countries that have a history of training, harboring, exporting terrorists. We can’t keep pretending and looking the other way,” said Conway.
3. The moratorium is largely temporary. Citizens of the seven countries named as security risks are banned from entering the United States for the next 90 days. Refugee processing is halted for 120 days. The longest-lived aspect of the ban may prove to be the halt on Syrian refugees, but that isn’t given a time frame at all. It will last “until such time as I have determined that sufficient changes have been made to the USRAP to ensure that admission of Syrian refugees is consistent with the national interest,” as President Trump wrote.
4. Obama banned immigration from Iraq, and Carter banned it from Iran. “Fact-checking” website PolitiFact twists itself into knots to avoid giving a “true” rating to the absolutely true fact that Jimmy Carter banned Iranian immigration in 1980, unless applicants could prove they were enemies of the Khomenei theocracy.
One of Politifact’s phony talking points states that Carter “acted against Iranian nationals, not an entire religion.” As noted above, Trump’s Executive Order is precisely the same – it does not act against an “entire religion,” it names seven countries.
As for Barack Obama, he did indeed ban immigration from Iraq, for much longer than Trump’s order bans it from the seven listed nations, and none of the people melting down today uttered a peep of protest. Richard Grenell summed it up perfectly in a Tweet:
5. Trump’s refugee caps are comparable to Obama’s pre-2016 practicesDavid French, who was touted as a spoiler candidate to keep Donald Trump out of the White House during the presidential campaign – in other words, not a big Trump fan – wrote a lengthy and clear-headed analysis of the Executive Order for National ReviewHe noted that after the moratorium ends in 120 days, Trump caps refugee admissions at 50,000 per year… which is roughly the same as President Obama’s admissions in 2011 and 2012, and not far below the 70,000 per year cap in place from 2013 to 2015.
Obama had fairly low caps on refugees during the worst years of the Syrian civil war. He didn’t throw open the doors to mass refugee admissions until his final year in office. Depending on how Trump’s review of Syrian refugee policy turns out, he’s doing little more than returning admissions to normal levels after a four-month pause for security reviews.
6. The Executive Order is legal: Those invoking the Constitution to attack Trump’s order are simply embarrassing themselves. The President has clear statutory authority to take these actions. As noted, his predecessors did so, without much controversy.
Most of the legal arguments against Trump’s order summarized by USA Today are entirely specious, such as attacking him for “banning an entire religion,” which the order manifestly does not do. Critics of the order have a political opinion that it will in effect “ban Muslims,” but that’s not what it says. Designating specific nations as trouble spots and ordering a pause is entirely within the President’s authority, and there is ample precedent to prove it.
It should be possible to argue with the reasoning behind the order, or argue that it will have negative unintended consequences, without advancing hollow legal arguments. Of course, this is America 2017, so a wave of lawsuits will soon be sloshing through the courts.
7. This Executive Order is a security measure, not an arbitrary expression of supposed xenophobia. Conway stressed the need to enhance immigration security from trouble spots in her “Fox News Sunday” interview. French also addressed the subject in his post:
When we know our enemy is seeking to strike America and its allies through the refugee population, when we know they’ve succeeded in Europe, and when the administration has doubts about our ability to adequately vet the refugees we admit into this nation, a pause is again not just prudent but arguably necessary. It is important that we provide sufficient aid and protection to keep refugees safe and healthy in place, but it is not necessary to bring Syrians to the United States to fulfill our vital moral obligations.
French’s major objection to the Executive Order is that applying it to green-card holders is “madness,” but unfortunately many of the terrorists who attacked Americans during the Obama years were green-card holders. Daniel Horowitz and Chris Pandolfo addressed that subject at Conservative Review:
Both liberals and conservatives expressed concern over hundreds of individuals going over to fight for ISIS. We are already limited in how we can combat this growing threat among U.S. citizens. Given that it is completely legal to exclude non-citizens upon re-entry, Trump extended the ban to legal permanent residents as well.

If a Somali refugee is travelling back to Somalia (so much for credible fear of persecution!), government officials should have the ability to prevent that person from coming back when necessary. Obviously, there are some individuals from these seven countries who already have green cards and we might not want to exclude. That is why the order grants discretion to the State Department to issue case-by-case exemptions for “religious persecution, “or when the person is already in transit and denying admission would cause undue hardship.” A CBP agent is always stationed at any international airport from which these individuals would board a direct flight to the United States (Paris and Dubai, for example). That individual would not allow anyone covered by this ban onto a U.S.-bound flight unless he grants them a hardship exemption.
Indeed, it appears that green card holders returning yesterday from those seven countries were all granted entry.
Because he is a progressive globalist, Obama deliberately blinded us to security threats, in the name of political correctness and left-wing ideology. Ninety or 120 days isn’t much time for Trump to turn all that around, especially because it is unlikely much will change in the seven countries Trump named.
The hysterical reaction to Trump’s order illustrates the very thing that worries advocates of strong immigration security: Americans’ security is the lowest priority, far below progressive ideology, crass political opportunism, and emotional theater.
We’re being effectively told by the theatrical class to tolerate a certain amount of Islamic terrorism because their feelings would be hurt by the tough measures we need protest ourselves from a tough enemy. But this time, President Trump is proving tough enough to push our security up into the top priority.

Thursday, January 19, 2017

Selling CSX

Hunter Harrison, the CEO of Canadian Pacific Railway, announced he will resign and try to join up with CSX, possibly as the CEO, to turn the railway around.

The full article is here in the Wall Street Journal:

http://www.wsj.com/articles/csx-investors-cheered-by-former-rail-rivals-sudden-switch-1484842700

And while this is potentially good news for CSX, the stock was already approaching my target sell price of $40 before this news.  With this announcement, the stock is up over 18.5% today, priced around $43.60 per share, and presents a great selling opportunity.

I sold my entire position today, almost a 2X sized position, and locked in a gain since purchase of roughly 115%.

Here is a FastGraph of CSX BEFORE today's price gain of over $6/share:


I'll move CSX to my watch list because I like the company, and put a target buy price on the stock of $27 per share.

That's all for now,

Chump