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Sunday, August 21, 2011

Bob Brinker Moneytalk Summary for August 21, 2011

This weekend Bob Brinker said the markets were "volatile."  I summarized the market volatility below.  Other than that, Brinker didn't have much to say about the stock market nor his bragging just weeks ago when the S&P500 was at 1290 and he was buying.   See:

Bob Brinker Buy Levels in graphical form

All Time High Market Statistics 08/21/11
S&P500 Chart
Last Market High 10/11/07 at 1,576.09
Current S&P500 Price 1,123.53
Decline in Points = 452.56
Decline in percent = 28.7%
2011 Intraday "Correction" Statistics 08/21/11
S&P500 Chart
Recent Market High 05/02/11 at 1,370.58
Last Market low 08/08/11 at 1,119.28
Current S&P500 Price 1,123.53
Decline in Points = 247.05
Decline in percent = 18.0%
Max Decline = 18.3%
So, despite all the noise from Brinker about a 1030 buy for the market, he was fully invested at the very top at 1576, issued a "gift horse" buying opportunity in the mid 1400s and has been calling "buying opportunities" all along yet the market is still down 28.7% from four years ago and down 18% from his recently bragging about buying.  ALL WHILE FULLY INVESTED IN STOCKS SINCE 2003!
Brinker's guest was Bob Lutz, author of the book, “Car Guys v. Bean Counters: the Battle for the Soul of American Business"
In 2001, General Motors hired Lutz out of retirement with a mandate to save the company by making great cars again. As vice chairman, he launched a war against the penny-pinching number-crunchers who ran the company by the bottom line, and reinstated a focus on creativity, design, and cars and trucks that would satisfy GM customers.
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2 comments:

  1. Long Time ListenerAugust 22, 2011 8:24 AM

    Back in 2000 Brinker raised cash before the 2000-2002 bear market but he recommended the aggressive put 50% of it into the NASDAQ via QQQ in the 80s. Can you add an update on that trade?

    ReplyDelete
  2. Update on Bob Brinker's 2000 QQQ Advice as of Thursday, August 25, 2011

    The last time Bob Brinker recommended reducing equities was in the summer of 2000 when he increased his 60% cash position to 65% of the total portfolio in P1 and P2.

    Brinker told his audience to stay in money fund at Vanguard to be liquid for "trading opportunities" .

    On October 16, 2000 Bob Brinker sent a special subscriber bulletin via email urging them to "Act Immediately" and put up to 50% of their cash reserves into the NASDAQ 100 index via QQQ for a trade he expected would occur quickly and end in 2 to 4 months

    You can see an actual copy of the special bulletin HERE.

    When the rally in QQQ failed to materialize as predicted, Brinker decided to NOT include this in his model portfolios when he published his November Marketimer newsletter dated November 6, 2010,

    The odd thing was he continued to recommend the investment in his newsletter until the QQQs lost about half their value, falling to the $40s, where he said to "hold for future price recovery."

    January 2001 Marketimer: Bob Brinker said, "We continue to emphasize the guidelines we have recommended with regard to the exposure in the Nasdaq 100 Index for the countertrend rally phase we expect.......we are expecting potential gains for the Nasdaq 100 Index of up to 50% or more as measured from the January 2 closing low....." (January 1, 2001, QQQQ closed at $64.30)

    April 6, 2001 Marketimer, Page 2; Paragraph 5: Bob Brinker said, "Recent weakness in the Nasdaq 100 Index (QQQ) shares has far exceeded our expectations. However, we believe subscribers holding a position in these shares will eventually be rewarded, although this holding will require both time and patience. With or without a buy signal from our long-term model, we expect the Nasdaq Composite and Nasdaq 100 Index to stage a significant recovery over the next several months." (April 1, 2001, QQQQ closed at $46.15)

    If you followed Brinker's advice to buy the QQQ shares any time following the October 16th bulletin until he stopped recommending QQQ for up to 50% of cash reserves, the top price you could have paid was $87.87 on Oct 20, 2000

    From Yahoo! QQQ from Oct 10 to Nov 1, 2000

    Today QQQ is $52.21 which is down 40.6% from $87.87, the highest QQQ was while Brinker was recommending it for up to 50% of cash reserves.

    ReplyDelete

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