Buying on Sale Applies to Stocks

“The concept of buying goods on sale is as ingrained in the American psyche as watching primetime sitcoms. We take for granted the idea that any good – a bar of soap, a Pontiac Grand Am or back-to-school clothing – is a better value when the price drops. When the local grocer advertises strip steaks on sale, your initial response might be to buy some. When your favorite fast-food restaurant runs a 99-cent sale on quarter-pounders, there’s a tendency to forego a home-cooked meal and load up on a sack full of patties and fries. Why are Americans like this? Because we crave value. We make mental notes of what constitutes a fair price and often wait until that price level is breached before we buy. We may scoff at a 24-pack of Pepsi priced at $5.99, but at $4.99 it’s suddenly within our range of perceived value.

“The financial markets may be the only institutions in the world that turn the basic doctrine of consumerism on its head. Investors are coached to believe that a stock is a better buy when the price rises, that it’s ‘safer’ to join the crowd in bidding the price up and ‘riskier’ to buy a stock declining in price. Wall Street, you see, likes to implant a ‘fear of omission’ in investors. We are led to believe that if we fail to buy a stock now, the price will only go higher and we will miss the rally.

“The first principle of value investing is to buy securities on sale, just as you would toiletries or a new automobile. You should not differentiate consumer habits from investing habits. There are one and the same. Whether you buy a grocery store item, shares of Intel, a bar of silver, a Treasury bond, or preferred stock in the local utility, you should try to obtain it on sale, when possible, to maximize its value per dollar of investment.”
- Timothy Vick in his 1999 book, Wall Street on Sale

Benjamin Franklin Quote

The man who trades freedom for security does not deserve nor will he ever receive either.
– Benjamin Franklin

Peter Lynch

"The key to making money in stocks is not to get scared out of them."
-Peter Lynch

The proper way to lick a bowl ...

Top Financial Scams

http://www.snopes.com/fraud/topscams.asp

I always find these amusing and they are worthy of your awareness.

I received a family member (friend) in distress email recently. The email seems almost possible at first until you think - why would this person be emailing me instead of calling a much more relevant person? The more relevant person knows, of course, that his mother is NOT in England on a trip.

Breakfast at Ginger's- golden retriever dog eats with hands

Ginger enjoys a leisurely breakfast
http://www.youtube.com/user/sawith65#p/c/CFDBAB87BCE3AD48/3/HaAVZ2yXDBo

Gin the Dancing Dog

A must see:
http://www.familytiez.com/video/gin.htm

Future Expected Stock Market Returns

Stock market returns have (theoretically at least) 3 components:

• Rate of Inflation
• Risk Free Rate
• Equity Premium

The expected return is the sum of these three. Current inflation is about 2.2%; historically the long-term risk free rate of return is about 0.7% and the equity premium about 4.8%. The sum is 7.7% which is the expected rate of return of the stock market.

This may seem surprisingly low to some who recall long-term rates of return for stocks in the 9% to 11% range. However, long-term rates of inflation are about 4.7% and the sum of the three components using that inflation rate is 10.2%.

So don't be shocked if nominal (including inflation) stock market returns in the current environment are lower that you remember. Do remember that what you get to spend is the real return (returns after adjustment for inflation) which is expected to be about 5.5% in both environments.

Basics of the Smart Investor

Smart investors maintain a long-term perspective, stay diversified, and don't react emotionally to every fluctuation.
- NAPFA Planning Perspective May-June 2010

Peregrine falcon fledgling in SF

The San Franciso Peregrine falcon couple on the PG&E building had four fledglings this year. All doing well so far. Here's a shot of one of the males (tiercel).

Picture by Glenn Nevill.

You can contribute to the group that sponsors the web camera and fledge watch by going to the UC Santa Cruz web site:

https://secure.imodules.com/s/1069/index-2-column.aspx?sid=1069&gid=1&pgid=361&cid=970

Be sure to type "SCPBRG" into the "Other Area" dialog box.

Managers vs. Markets

Proponents of active management believe that skilled managers can outperform the financial markets through security selection, market timing, and other efforts based on prediction. While the promise of above-market returns is alluring, investors must face the reality that as a group, US-based active managers do not consistently deliver on this promise, according to research provided by Standard & Poor’s.

S&P Indices publishes a semi-annual scorecard that compares the performance of actively managed mutual funds to S&P benchmarks. Known as the SPIVA scorecard1, the report analyzes the returns of US-based equity and fixed income managers investing in the US, international, and emerging markets. The managers’ returns come from the CRSP Survivor-Bias-Free US Mutual Fund Database, and the managers are grouped according to their Lipper style categories.2

The graph below features fund categories from the most recent SPIVA scorecard—all US equity funds, international funds, emerging market funds, and global fixed income funds—and shows the percentage of active managers that were outperformed by the respective S&P Indices in one-, three-, and five-year periods. These are only four of thirty-five equity and fixed income fund categories. But a deeper analysis confirms that the active manager universe usually fails to beat the market benchmarks over longer time horizons. Underperformance of active strategies is particularly strong in the international and emerging markets, where trading costs and other market frictions tend to be higher.

Over the last five years, about 60% of actively managed large cap US equity funds have failed to beat the S&P 500; 77% of mid cap funds have failed to beat the S&P 400; and two-thirds of the small cap manager universe have failed to outperform the S&P Small Cap 600 Index. Furthermore, across the thirteen fixed income fund categories, all but one experienced at least a 70% rate of underperformance over five years.

In 2009, active funds experienced more success over a one-year period, and proponents typically highlight those results in the SPIVA scorecard. However, one-year results are not consistently strong from year to year, and investors should not draw conclusions from short-term results. Over three- and five-year periods, most fund categories have not outperformed their respective benchmarks.

This poor track record appears in other research, as indicated in the graph below. This study compared the same actively managed funds in the CRSP database to the Russell benchmarks and showed similar results over the three- and five-year periods. Over the past five years, about 65% of all US equity managers failed to outperform their respective Russell Indexes, and 84% of fixed income managers failed to beat their respective Barclays Capital Indices.

Of course, the results of these studies will fluctuate over time, and a majority of funds in a given category might outperform over the short term. But the message is clear: As a group, actively managed funds often struggle to add value relative to an appropriate benchmark—and the longer the time horizon, the greater the challenge for active managers to maintain a winning track record.

1. SPIVA stands for Standard & Poor’s Indices versus Active Funds. The report covers US equity, international equity, and fixed income categories. The actively managed funds are grouped according to Lipper style categories.

2. The Center for Research in Security Prices (CRSP), at the University of Chicago Booth School of Business (Chicago GSB), is a nonprofit center that also functions as a vendor of historical data. CRSP end-of-day historical data covers roughly 26,500 stocks listed on the NYSE, Amex, and NASDAQ exchanges. The Survivor-Bias-Free US Mutual Fund Database includes a history of each US mutual fund’s name, investment style, fee structure, holdings, asset allocation, and monthly data, including total returns, total net assets, net asset values, and dividends. All data items are for publicly traded open-end mutual funds and begin at varying times between 1962 and 2008, depending on availability. The database is updated quarterly and distributed with a monthly lag.

Past performance is no guarantee of future results. This article is provided for informational purposes only and should not be construed as an offer, solicitation, or a recommendation from Dimensional Fund Advisors. Dimensional Fund Advisors is an investment advisor registered with the Securities and Exchange Commission.
©2010 Dimensional Fund Advisors. Used with permission.

Goldman Sells a Whatzit

We're sure you've all heard of the Goldman Sachs Abacus scandal, but most folks don't really understand what it means. Well, Goldman created a CDO called Abacus and sold it to its clients. But Goldman forgot to tell its clients that Abacus was designed to fail. Meanwhile, Goldman had placed numerous side bets that it would do just that. It was like "The Producers," that movie in which some dudes raise a mint to put on a show destined to bomb, intent on pocketing the investment money.

But most folks have no idea what a CDO is, what the hell is a derivative. Trust us. We have worked in (or very close to) financial services for eight years. Ask anyone to explain a default swap. Watch them stammer and bullshit. They don't know either. We can only tell you they appear to be an unholy hybrid between an insurance policy and a side bet at a cockfight.

So to help us understand what went down at Goldman Sachs, we've enlisted infamous children's book writer Nurse Noose to explain it to us as if we were five. And here it is:

GOLDMAN SELLS A WHATZIT

In the land of Maglop, just south of Canack
A rich man named Goldman McSachy-McGlack
Arrived into town with a large golden sack
It was stuffed full of whatzits and slung on his back
The foos that inhabit the land of Maglop
Watched as McSachy-McGlack set up shop
The new shop was chic, it was shiny, compelling
"What are you selling?" the foos started yelling
McSachy-McGlack smiled and answered the foos:
"Come see for yourself, you've got nothing to lose."

Inside the shop, there was box upon box
And each box was locked up with five golden locks
"What is it?" they asked, their eyes bright with greed
"It's a whatzit, that's what, and it's just what you need"
"What does it do?" asked young Cindy-lu Foo
"Well" said McSachy-McGlack "I'll tell you"
"It makes the poor rich, and it makes the rich richer
And the richest more richester, now get the picture?
Just buy one or two, put them under your bed
And leave them alone, get them out of your head
And then sell them back, and worse comes to worst
They will be worth ten times what they cost you at first"
"But" he continued "there's one caveat"
The impatient foos said in unison "what?"
"The whatzit will work only if it stays locked"
"What's in a whatzit?" the older foos mocked
"It doesn't concern you, just don't open the box
Keep it under your bed, and don't unlock the locks"
"I'll take one" said one foo "I'll take three or four"
"I'll take a dozen" "put me down for a score!"

Each foo soon had his own whatzit stash
And each knew that soon they'd be rolling in cash
So they bought foo-mobiles and they mortgaged their huts
They had foo boob jobs and foo liposucked butts
What happened next? Well, what do you think?
The whatzits, one-by-one, started to stink
They reeked to high heaven, all icky and rank
Like bungle-beast farts, that's how much they stank
The foos plugged their noses, they cursed and they swore
Til Cindy-lu Foo couldn't take anymore
She took out her whatzit and unlocked the locks
She took a deep breath and she opened the box
What was inside? Well I've got the scoop:
Each whatzit was stuffed full of snorgle-pig poop
When word got around, every foo would lament
"My whatzit portfolio aint' worth a cent!"

They soon lost their jobs, and then lost their houses.
They started to drink, they were beating their spouses
By the time they were left with no foo-pot to piss in
Goldman McSachy-McGlack turned up missin'
What happened then? It just keeps getting better
Taped to his boarded up shop was a letter
"I'm sorry you're left with nary a cent
But look on the bright side! I've made a mint!
See, to tell you the truth (and I know the truth hurts)
I placed a side bet that the Foos lose their shirts."
"The moral" it said "you should know now by heart:

A foo and his money are destined to part"

-Can O' Whup Ass
for more: http://canofwhupass.typepad.com/my_weblog/

The 4 x 4 Accuracy vs Doubt Matrix

-4-Block World
For more: http://www.4-blockworld.com/

Grand Canyon river trip video

http://www.youtube.com/watch?v=yRoP8ztiA3k

The first segment is a view of a California condor.

Banding day for the Peregrine Falcons

for live video: www2.ucsc.edu/scpbrg/nestcamSF.htm

Things not to do ...

-Carl Richards, New York Times

The "Lost Decade of Investing" - Bah!

By now you’ve probably seen an article or heard a news story touting that the past 10 years (2000-2009) was a “lost decade” for stocks. As measured by the media, everyone lost money, and as proof they site the fact that the S&P 500 lost 9.1% from Jan. 1, 2000-Dec. 31, 2009. While this statistic is indeed true, it’s an isolated view.

The S&P 500 is an index composed of 500 of the most widely held (and typically largest) companies in the U.S. While 500 companies may sound like a lot and may seem well-diversified, it’s actually a narrow slice of the universe of companies available for our investment dollars.

At ICM, our portfolios consist of at least six asset classes – not just one (see note below). The portfolios that we are all invested in at ICM contain a piece of more than 10,000 companies. The very smallest companies up to the very largest conglomerates are included in our portfolios. These companies are located in over 40 countries around the globe.

Why maintain such a diversified portfolio? Because each year each asset class has a different return, and when these returns are blended together over a period of time, the effect of diversification tends to increase the portfolio return and decrease the portfolio risk. The chart below shows the total return for the past decade for some of the DFA mutual funds we use. You can see that whereas large company U.S. stocks were negative for the decade, many other asset classes were positive – and some substantially positive. We own many of these funds within our portfolios.

A Look Beyond the S&P 500 January 2000-December 2009
Source: Dimensional Fund Advisors. Performance data represents past performance and does not predict future performance.

Even though it has not been a lost decade for stocks in general, it has certainly been a gut-wrenching ride. The decade began with a bear market in which the S&P 500 was down ~ 49% (March 2000-October 2002) and then remarkably sustained a second bear market that saw the S&P 500 drop ~50% between October 2007 and February 2009.

Looking at it this way, given the severity of these two bear markets over the past decade, it is impressive that the S&P 500 ended the decade with only a 9.1% loss.

Although this was a “lost decade” for the S&P 500, it is exceedingly rare. Between January 1926 and December 2009, 95% of all possible rolling ten-year investment periods delivered positive returns for U.S. large company stocks. This past decade falls into the 5% that failed to produce gains.

We hope that this gives you a better understanding of how diversification has improved the performance and reduced the risk within your portfolio. So ignore the talking heads proclaiming that “this time it’s different.” Take a deep breath and remind yourself: diversification within a prudent portfolio does work, buy-and-hold is not dead, and the laws of gravity have not been suspended.

Note: There are numerous ways to segment the universe of stocks. For simplicity in this example, let’s call the six asset classes U.S. large and small companies, Developed International large and small companies, and Emerging Markets large and small companies. Most of our portfolios also contain bonds, which would be a separate asset class. As you may remember, our portfolios have a tilt toward value companies (versus growth companies) and small companies (versus large companies).

-Julie Schatz, CFP®, Jennifer Cray, CFP®, Rich Chambers, CFP®

Health Care Poetry

"Say," Speaker Pelosi exuded,
When her colleagues to sausage alluded,
"If this casing we're filling
Is best after grilling,
Who cares how the wurst was extruded?"

-Limericks Économiques

Seven Questions to Ask Your Tax Preparer at Tax Time

When you visit with your tax preparer to drop off your tax return documents, be sure to ask the following seven questions and share the answers with your financial planner:

1. Will I be subject to the alternative minimum tax (AMT) in 2010?
2. What will my marginal tax bracket be in 2010?
3. Can you help me estimate my income for 2010?
4. Do I have any remaining capital loss carryforwards for 2010?
5. If I were to do a Roth conversion in 2010, what would my tax liability be?
6. Do you have an recommendations for reducing my 2010 taxes? What about 2011 and beyond?
7. Is there anything my financial planner can do to help my tax situation?

Warren Buffett's Letter to Shareholders

A favorite portion:

“We’ve put a lot of money to work during the chaos of the last two years. It’s been an ideal period for investors: A climate of fear is their best friend. Those who invest only when commentators are upbeat end up paying a heavy price for meaningless reassurance. In the end, what counts in investing is what you pay for a business – through the purchase of a small piece of it in the stock market – and what that business earns in the succeeding decade or two.”
-Warren Buffett

To read the whole letter:
http://www.berkshirehathaway.com/letters/2009ltr.pdf

Roth IRA Conversion Concepts

Roth IRA conversions will be much in the news this year. While Roth conversions have been allowed for years, starting in 2010, the income limitations are lifted, so everyone is eligible. We want to prepare you now so you will begin thinking whether or not a conversion could increase your after-tax net worth.

Many people know how Roth IRAs and regular (contributory or rollover) IRAs work. But if you want a refresher, let me know and I’ll send you an educational piece.

Why all the fuss? Because the growth of a Roth IRA isn’t taxed and this is about the closest thing to a freebie that the federal government offers to taxpayers.

The Roth conversion process:

• take money out of a regular IRA
• contribute the entire withdrawal to a Roth IRA
• from another source, pay income tax on the withdrawal

You are paying taxes now in order to obtain future tax-free growth.

Rather than go through a bunch of tedious explanations, we examine a number of scenarios.

Scenario 1: Conversion during a low tax year

Scenario 1, Example 1:
Bill (40) got laid off in January and took the rest of the year off. His income was $12,000 from interest and dividends and a bit of unemployment. His credits, deductions, and exemption add up to $44,000, so his taxable income is -$32,000. Bill has $32,000 in his IRA so he can convert all of it to a Roth with no additional tax owed. At age 90, the after-tax value of Bill’s Roth IRA will be about 43% larger ($284,700) than the unconverted IRA.

Scenario 1, Example 2:
Sarah (40) terminated a business and took an operating loss of $100,000. Her income was $70,000 from interest and earnings. Her credits, deductions, and exemption are $50,000. Similar to Bill, Sarah can convert $80,000 to a Roth for no tax cost and gain a similar 43% ($709,200) advantage at age 90. If Sarah were to convert another $34,000 (maxing out her 10% and 15% tax bracket and costing $4,681 for income tax), the advantage is about 38% for a total after-tax advantage of $920,700.

Scenario 1, Example 3:
Roger (40) has taxable income of $34,000. He wants to max out the 25% tax bracket this year and expects to be in the 25% bracket during retirement. Roger converts $48,400 costing $12,100 in additional income tax. At age 90, Roger’s advantage is 16% ($196,600). If Roger needs $5,000 annually for living expenses beginning at age 70, the advantage is 19% ($85,100).

Typical reasons for low tax years:

• Getting laid off
• Deductions and exemptions wipe out most or all of your income, such as:
• ....Large charitable contributions
• ....Large casualty losses
• ....Large medical expenses
• ....Large nursing home expenses
• Business and other ordinary losses
• Net operating loss carry-forwards
• Selling a rental property at a loss
• Non-refundable tax credits
• Note: Capital loss carry-forwards do NOT help much

The general rule is that you convert to a Roth in years when your marginal tax rate is lower or the same as the marginal rate expected at age 70 ½.

Scenario 2: Conversion for the benefit of your heirs

Scenario 2, Example:
Abby (40) is a very successful entrepreneur, and thanks to a wildly successful IPO, she has considerably more than she needs for the rest of her life. Understandably, Abby can leave a substantial estate to her 2 children ages 7 and 10. A Roth IRA is tax free for Abby’s lifetime and also for the children’s lifetimes. Therefore the Roth IRA is one of the best items to bequeath to your heirs. Abby’s IRA is $100,000 and she expects to be in the highest tax bracket for the remainder of her life. It costs $35,000 in tax to convert, but at 90, the after-tax value of Abby’s Roth IRA is about 22% larger ($531,700) than the unconverted IRA. If the heirs drawdown the inherited Roth IRA over 40 years, the additional advantage is about 47% ($12,809,600).

The general rule is that when all these are true …

• You expect to be in the highest tax bracket forever
• You do not need your IRA assets to live on
• Your estate is to benefit your children
• You can pay the conversion tax with other assets

… You should consider converting everything to a Roth IRA as soon as possible.

Scenario 3: Opportunistic conversion

Scenario 3, Example:
Angus (40) had a $500,000 IRA invested in a IPO stock that was clobbered in the recent bear market, so the IRA is only worth $100,000 now. Angus is completely confident that the company will survive and grow and that the IRA value will recover back to $500,000. Needless to say, we think Angus is nuts, but if he is right, it sure is a great time to convert to a Roth. Angus is in the 35% tax bracket this year but expects to be in the 25% bracket when he is 70 ½. Converting now costs $35,000 in tax, but at age 90, the Roth is about 8% larger ($214,000) than the unconverted IRA, and that is if the stock never recovers. If the stock recovers, and is replaced with diversified investments, the Roth IRA advantage is 34% ($3,528,000).

The general rule is if you think your IRA is temporarily at a low valuation, then it may be a good time to convert to a Roth even if your tax bracket is higher now than in retirement.

Scenario 4: Tax diversification conversion

Scenario 4, Example:
Matt (40) has a $100,000 IRA and he doesn’t believe anyone can forecast future tax rates, plus he cannot forecast his income before or after retirement. Since the tax rates are an unknown, Matt wants to consider having regular IRA and Roth IRA accounts . Matt can choose a low-income year for converting some of the IRA to a Roth, and in retirement he can withdraw from the IRA in low-income years and from the Roth in high-income years. Matt gains better control of his taxes since he has access to taxable income from the IRA and tax-free income from the Roth.

General Roth conversion rules:

• You never, ever want to show a negative taxable income on your tax return. A Roth IRA conversion can be used to get to zero income at no cost.
• Never withhold taxes on a Roth conversion (pay the taxes from external sources).
• If your marginal tax rate is 15% (federal), consider a Roth conversion to use up the entire 15% bracket.
• Roth IRA accounts are among the best possible assets to pass to your heirs. Convert more aggressively if you plan for your heirs to get most or all of your Roth IRA.
• Those expecting to be in the highest marginal tax bracket forever may benefit from an immediate conversion of the entire IRA balance.
• The longer you can compound the Roth IRA, the bigger the advantage of converting. And the longer your heirs hold onto the inherited Roth IRA, the bigger the tax advantage to them.
• Having both an IRA and a Roth IRA provides tax diversification. With both IRA and Roth IRA accounts, you can have better control over your marginal tax rate every year. Generally you want may want to take IRA distributions in low tax years and Roth distributions in high tax years. Having some IRA and Roth IRA assets can be very beneficial for managing for tax rates in retirement.
• When your IRA has a temporarily low valuation, consider converting to a Roth.
• You are not permitted to convert any of your RMD (required minimum distribution).
• In some select cases, estate taxes can be reduced thanks to a Roth conversion.
• If you convert in 2010, you have a choice about paying the resulting income tax. You can report all of the income (from the Roth conversion) in 2010 or report 50% of the income on your 2011 tax return and the other 50% on your 2012 tax return. Normally you want to delay paying taxes, but you must consider future increases in tax rates that make could make waiting more costly.
  

Some things that could occur that could make the Roth conversion less valuable or even worse than not converting:

• Income tax rates are reduced substantially or repealed and a national sales tax replaces the tax revenue.
• You plan to gift to charity all of your required minimum distributions from your IRA.
• You are unable to pay the income tax on the IRA distribution with other assets reducing the amount converted to the Roth IRA.
• The stock market drops precipitously after the Roth conversion. By waiting you could have converted for less tax cost.
• The income from the Roth conversion may cause your Medicare Part B premiums to increase significantly, at least temporarily.
• Many deductions and credits on your tax return are linked to your AGI (adjusted gross income). A Roth conversion will increase your AGI, which may adversely impact other (non-obvious) areas of your total tax. One example, if you are expecting financial aid for college, a Roth conversion can reduce the aid award.

All may not be lost however: If you convert to a Roth, you may recharacterize (move the money from the Roth IRA back to the IRA) some or all of the conversion reducing the taxes owed. There are strict time limits on when the recharacterization may occur.

As you can see, analyzing a Roth conversion is complex and involves multiple factors. Financial planners or tax professionals that perform tax planning are able to help you make wise decisions about Roth conversions.

Assumptions used in all the scenario examples:

• The conversion tax year is 2010.
• The marginal tax rate in retirement is 25%.
• Long-term capital gains rate is 15%.
• Any state income tax is not considered.
• Unless otherwise noted, no living expenses are taken from either the IRA or the Roth IRA. When needed, living expenses are after tax and are to be taken from the IRAs starting at age 70 and increase 3% annually.
• Return rate on IRA investments averages 7% consisting of 2% qualified dividends, 1% interest, non-qualified dividends, and short-term capital gains, and 4% long-term capital gains.
• Each year, 40% of that year's long-term gains are realized.
• No tax credits are affected by converting to the Roth
• All tax owed is paid in the year following the Roth conversion from other resources (not from the proceeds of the IRA distribution, therefore all the proceeds go into the Roth IRA).
• The advantage of the Roth conversion is measured compared to the after-tax value of the unconverted IRA.
• The advantages of a Roth conversion shown in the examples are computed using an ICM-developed worksheet, and while believed accurate, cannot be guaranteed.

© Copyright 2010, Investor's Capital Management, LLC

A Foggy Crystal Ball

"It's a good thing that financial planners and advisors aren't paid to predict the future because, well, nobody seems to be doing a very good job of it lately. I hope you'll remember this as all the major financial magazines come out with their yearly "Here's what will happen in 2010" cover stories.

Reading through some back issues, we find that at this time two years ago, nobody, anywhere, was predicting a fourth-quarter meltdown in the investment markets, or the global economy tottering on the edge of disaster. In fact, not a one of the prognosticators seems to have realized that the U.S. economy had already fallen into a recession. ..."

For the remainder of this interesting article by Bob Veres:
http://tinyurl.com/ybchke3

Remodeling - How to Make it Pay

"There could be one upside to the real-estate implosion. Plunging prices finally could shatter our national delusion that home improvements are somehow an "investment" in our homes.

Think about it:

• With a real investment, you commit your money and hope to make some kind of profit.
• With remodeling, you're all but guaranteed a loss.

Even at the real-estate market's peak, most remodeling projects didn't pay for themselves."

For the rest of this article by Liz Pulliam Weston of MSN Money, click here: http://tinyurl.com/ydyjbu9

If you can't access the article, let me know and I will try to find it for you. rich.chambersABC@gmail.com Spam prevention: Remove the ABC from the email address before using it to email to me.

Blame it on the Brain

"Willpower, like a bicep, can only exert itself so long before it gives out; it's an extremely limited mental resource.

Given its limitations, New Year's resolutions are exactly the wrong way to change our behavior. It makes no sense to try to quit smoking and lose weight at the same time, or to clean the apartment and give up wine in the same month. Instead, we should respect the feebleness of self-control, and spread our resolutions out over the entire year."


For the rest of this article by Jonah Lehrer of The Wall Street Journal, click here: http://tinyurl.com/y8f7f4k

The link works only for a few days. If you can't access the article, let me know and I will try to gain access for another short period. rich.chambersABC@gmail.com Spam prevention: Remove the ABC from the email address before using it to email to me.

The Market May Be Crazy...

"The market may be crazy but that doesn't make you a psychiatrist."

-Meir Statman