The Stingy News Weekly (12/06/02)
The Markets This Week
DOW 30: 8,646 -2.81% with a median P/E of 24.0
S&P/TSX: 6,577 +0.11% with a median P/E of 23.0
The Value View
Dow at a P/E of 20: 7,205 (-16.7%) Poor Value
Dow at a P/E of 15: 5,404 (-37.5%) Fair Value
Dow at a P/E of 10: 3,603 (-58.3%) Good Value
S&P/TSX at a P/E of 20: 5,719 (-13.0%) Poor Value
S&P/TSX at a P/E of 15: 4,289 (-34.8%) Fair Value
S&P/TSX at a P/E of 10: 2,860 (-56.5%) Good Value
New @ StingyInvestor
10 Graham Picks for 2003
December is filled with family, friends, and, for investors, the dreams of healthy dividends. In what has become a December tradition, I look at Benjamin Graham's strategy for defensive investors using the MSN.com stock screener. Long-time Canadian MoneySaver readers will note that this is the third time I've discussed Graham's conservative technique.
A new Stingy Contest
Try to outfox other investors for a chance to win a copy of the new book "The Contrarian Investor's 13". Based on previous contests, the odds of winning are quite good!
The holiday bonus bait and switch
"Achille says her firm will continue to give bonuses "come hell or high water." Her reason? Achille is determined to retain talented staffers, whom she calls the company's "greatest assets." Every one of her 15 employees can count on getting a yearly check, based on corporate profitability and their own contributions to the cause."
Sell on strength, legendary investor says
"Age can turn a man bearish. For the greater part of the past half-century Wall Street financier Leon Levy has been an optimist. Levy believed that the U.S. economy would, through a succession of business cycles, reignite and spark the higher profits that are the fuel of rising share prices. Today, at 77, worn but wealthy and still active as an investor, he is more pessimistic about the U.S. economy and stock market than ever before in his adult life. "The outlook for profits is disappointing," Levy says. "It's very hard to tell how bad the economy will be. Still I feel it will be worse than any time since World War II.""
Compensation is getting personal
"Imagine that your company's human-resources department does away with standard salaries, one-size-fits-all benefits, and the usual raft of yawn-inducing seminars. Instead, HR execs huddle over computer programs that slice and dice data on you and your cube-mates -- controlling for age, tenure, educational background, commute time, residential Zip Code, even the age and condition of the office you work in."
Questions for the genie
Bill Gross talks about inflation, interest rates and the outlook for bonds.
Should you sue?
"Guess what: You already have. What do you do when you're part of a class action?"
Don't go hungry in the coming yield famine
"Stalking yield is trickier than ever -- you need to build enough of the right kind of returns into your retirement portfolio so that you cut risk down to size. Here are some of your choices."
The chief freaked-out officer
"How Enron, Tyco, and the rest have made the chief financial officer's job less, uh, fun."
Who moved my thumbs?
"We find a management theory that makes getting fired look pretty good."
Enron, one year later
"The real macro focus (apart from the Fed) should be the "agency problem," the problem of management not having the incentive to efficiently use stockholder funds. Agency problems definitely played a major role in recent scandals, especially given that the wave of corruption was almost completely isolated to corporations, not proprietorships and partnerships. Business per se in America hasn't been shown to be corrupt."
This week's trivia questions are: Q1. Who said "Bears don't live on Park Avenue."? Q2. Who said "Your success in investing will depend in part on your character and guts, and in part on your ability to realize, at the height of ebullience and the depth of despair alike, that this, too, shall pass."? Q3. Who said "Investors repeatedly jump ship on a good strategy just because it hasn't worked so well lately, and, almost invariably, abandon it at precisely the wrong time."? The answers to last week's trivia questions are: Q1. Who said "A small loss, when realized, becomes an opportunity for profit elsewhere."? A1. Martin Zweig Q2. Who said "One of the best rules anybody can learn about investing is to do nothing, absolutely nothing, unless there is something to do. Most people always have to be playing - they always have to be doing something."? A2. Jim Rogers Q3. Who said "If you expect to continue to purchase stocks throughout your life, you should welcome price declines as a way to add stocks more cheaply to your portfolio."? A3. Warren Buffett Source: Wall St Wit & Wisdom The Stingy StoreDownload a sample of the Rothery Report Download a sample of Frugal Funds Subscribe Today Bullishly Yours, Norman Rothery ISSN 1499-2795 To (un)subscribe please use our email centre at http://www.stingyinvestor.com/cgi-bin/email.cgi Refer to legal & conflict of interest disclaimers at http://www.stingyinvestor.com/SI/legal.shtml http://www.stingyinvestor.com/SI/legal/conflict.shtml
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