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

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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