Bob Brinker Moneytalk Summary for August 28, 2011

This weekend KGO radio in San Francisco played spliced together parts of past Moneytalk shows with Bob Brinker answering general questions. Reports say KGO did not announce it was a "best of Bob Brinker show" like they do for the other shows they produce themselves.

This inspired us to write a New  article:

Brinker's Rules on Investing - Become Your Own Money Manger  

Feel free to add to that list here if you know of any "rules" we left off.

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:

August 6 Market Update and Bob Brinker's Recent Advice to not Sell

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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Gold, I-Bonds, CDs & Savings Account Rates

Gold (chart and Quote) is going crazy! 

• Gold made an all time new high today of $1,818.90 per ounce!
• If you want to buy gold for your portfolio as an investment or to trade , my recommendation has been to buy the exchange traded fund, GLD (chart and quote).  This is the same advice Bob Brinker gives.  Most other methods to buy gold involve high expenses.
• Note: I own gold and silver coins and misc jewelery but currently don't hold GLD. 

Buy i-Bonds: New Series I Bond Rate:

• Now yielding a 100% safe 4.60%, I think Series I-Bonds are very attractive for cash in taxable accounts.  You can buy up to $10,000 per Social Security number.  $5,000 from TreasuryDirect.gov and $5,000 in paper form at your local bank.  This is the last year paper iBonds will be sold so get them while you can.
• The earnings rate for Series I Savings Bonds is a combination of a fixed rate, which applies for the life of the bond, and the semiannual inflation rate.  Series I Bonds Explained and 
• Note:  I own a lot of Series I Bonds, some with base rates as high as 3.00%!
  See Earning Rates for Older I-Bonds

Best CD and Savings Rates:   Best CD Rate Survey

Bob Brinker recommends CDs on his show for those who don't want to take any interest rate risk with GNMAs or any other bonds.  That is bonds will lose net asset value if interest rates go up. 

• I'd keep the term to 2 years or less.  Perhaps make a CD ladder with
• a 6-month, 1.05% CD at Nexity Bank
  
• a 1-yr, 1.40% CD at Nexity Bank and
  
• an 18-month, 1.32% CD at Aurora Bank  and
  
• a 2 year 1.45% CD at Aurora Bank

Kirk Lindstrom's Investment Letter

• Subscribe to my service NOW and get the August 2011 Issue for FREE! !  
  
• Get email alerts when I buy or sell securities for my explore portfolio
• "Auto Buy" and "Auto Sell" levels set ahead of time for target buy and sell levels for my securities.  This allows you to place "limit orders" with your broker in advance so you can go about your business.  I send email alerts after these execute as reminders.
  
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Long Term Results that Speak for Themselves

Since 12/31/98 "Kirk's Newsletter Explore Portfolio" is UP 200%
vs. the S&P500 UP only 21% vs. NASDAQ UP only 17% (All through 8/15/11) 
(More Info & Portfolio Returns)

"Highest CD RatesSurvey" 
as of August 15, 2010

Term	Highest Rate (APY)	Where? (Click link for Full Rate Sheets)
Vanguard Daily	0.02%	Vanguard Prime Money Market Fund
Vanguard Tax Exempt	0.05%	Vanguard Tax Exempt Money Market Fund
FDIC Daily Savings	1.15%	Best Savings Account Rate Survey
6 Month CD	1.05%	AloStar Bank merging into Nexity Bank
6 Mo US Treasury	0.07%	US Treasury Rate Quote
1 Year CD	1.40%	AloStar Bank merging into Nexity Bank
1 Yr US Treasury	0.10%	US Treasury Rate Quote
18 - Month CD	1.32%	Aurora Bank
2 Year CD	1.45%	Aurora Bank
3 Year CD	1.98%	Security Service CU
4 Year CD	2.07%	Melrose CU & 2.06% @ TAB Bank
5 Year CD	2.57%	Security Service CU
5 Yr US Treasury	0.95%	US Treasury Rate Quote
7 Year CD	3.30%	Security Service CU &  2.75% PenFed CU
10 Year CD	3.00%	Discover Bank
10 Yr US Treasury	2.25%	US Treasury Rate Quote
30 Yr US Treasury	3.73%	US Treasury Rate Quote

 

Marketimer Special Bulletin - A New Low in Marketing?

We are getting word that Bob Brinker sent out a "special bulletin" to subscribers of his "Marketimer" newsletter as well as those who don't subscribe.

A subscriber tells us that when they logged in they were told "there is no bulletin."

We got an email last night asking us "Does anyone know what Brinkers 8/9/11 bulletin said?" We assume this means news of the bulletin went out to non-subscribers and/or expired subscribers too.

Why send out a bulletin to paying customers then not offer them some insight into the market after it has fallen drastically since telling your audience at much higher levels that you were not selling?

"Of course, the market is now at 1292, a couple of percent higher than when that call came in at the end of June. So this is what happens. If that individual would have sold out at 1270 at that time, he would be faced now with either sitting it out or re-entering at a higher level."   July 31st Advice

We can see why you would advertise a special bulletin to those who did not renew your newsletter. You can hope they will pay again to renew just to see if you advised selling stocks after a huge decline.

Brinker sold AFTER the 1987 Bear Market decline so he has a history of selling near bottoms after big declines. See:

• Bob Brinker's Asset Allocation History.

What we don't understand is why he would risk reminding his current subscribers that he has had nothing to say since bragging about not selling with the S&P500 at 1292 less than two weeks ago? See:

• Moneytalk: August 6 Market Update - July 31st Advice

S&P500 with April 29, 2011 peak

S&P500, DOW & NASDAQ Since April 29, 2011 peak

Click images to see full size graphs

Market Update - Brinker said Remain Fully Invested

July 31, 2011 Moneytalk Update:

Bob Brinker remains fully invested. Last Sunday, July 31, 2011, Bob Brinker said it was amazing how the stock market had taken all of the debate over the debt ceiling in stride. He said the S&P 500 was "setting about 5% below its closing high for the year, which is truly amazing."

Of course, the market is now at 1292, a couple of percent higher than when that call came in at the end of June. So this is what happens. If that individual would have sold out at 1270 at that time, he would be faced now with either sitting it out or re-entering at a higher level.

Bob Brinker went on to say he was not part of the "panic crowd"

New article August 6 Market Update and Bob Brinker's Recent Advice to not Sell

August 6, 2011 Market Update:

S&P 500	Intraday		S&P 500	Closing
Date of last bull market high	05/02/11		Date of last all time high	04/29/11
Last Market High	1,370.58		Last Market High	1,363.61
Date of last low	08/05/11		Date of last low	08/05/11
Intraday Low	1,168.09		Closing Low	1,199.38
Decline in Points	202.49		Decline in Points	164.23
Decline in %	14.8%		Decline in %	12.0%

S&P500 YTD with my "auto buy" level shown with a dashed blue line

click image for full size graph

August 6 Market Update - July 31st Advice

August 8 Market Update:

A devilish decline in the S&P500 today, 6.66%!
Makes you wonder if it was on purpose.