Strange time - buying gold and commodity?

https://www.youtube.com/watch?v=IKvC3r_5a4k

Doug Casey was correct in many of his predictions:

The commodity is probably at the bottom, gold mining company might be a good target to invest.

When interest rates go up, the bond market will collapse.

The city will revive, the suburb is a lifestyle that will disappear.

Howard Marks and OakTree Capital

He earns more during the downturn - 18% per year.  His memo is something worth reading -  even Buffet reads it as soon as he gets it. His dividend stock is yielding 7.5%.

As I shift more to income type of investment, and especially in the coming downturn, worth looking.

Simple Taiwan ETF TW50

Viewed an investment advise on retirement investing - buying TW50, which reliably payout >4% for the dividend.  If someone can sale and buy 4 times a year using Stochastic Ocililoar KD index (<20 buy graduate, >80 sell gradually), one can expect to double the yield.  If this is done is Taiwan, it might be close to tax free - effectively generate >10% return.

So for NT$10M, it can generate NT800K a year, not too bad for retirement allowance.

The interviewee mentioned something interesting - with Taiwan CD interest rate at 1%, the "risk" is 100%!! since the inflation is about 2-3 percent per year.

ACBFF Aurora Cannabis Inc. CHHE:US

Ah, Cannabis, to be or not to be?

A student, John, in my computer architecture class talked to me about buying stock in the Cannabis industry in light of the Coke Cola announcement that it will be going to the business.

My postdoc student owns CHHE, which is trading to think that it not a valid investment.

https://www.marketwatch.com/investing/stock/chhe

BHC, ANET, Markel, and the old BRK.A

All interesting, but the stock market is now overvalued.  Need to decide when to sell off.  The month of Oct is usually not a best time for stock.  So may be the end of Sep?

Back in the saddle of investment

2016-2018 is best, and alas, the worst, of time.  Other than the "grand journey" to Mt Sierra, I put a few mils in BHC (the old Vealean) at $33 expecting a quick recovery to about $100, it did not happen.  It actually dropped to $11!!!!  Now is back to about $24, still not happy but it has some hopes.

Bought the ASHR in 2016 expecting the Chinese stock will double in a couple of years because the real estate investment in China has over-inflated the price.  Well, I did not expect the love for real estate is so strong and Trump will engage the trade war with China.  How pointless and sad.

Bright Spots

- google price has doubled over the same period of time.
- sold the Sonoma/Seaside property at $330 and doubled my money back
- bought Gonzalas property at 20% below market and receiving 7% return.

Now the kids are going to college, I should have more time to spend on investment.  Really not for the money, it is, just like Buffet said, for keeping scores.  My lifestyle is simple enough that anything over $200K per year is not going to make any difference.  But if I can $2M per year, that will be different ;)

Reflection on China ETF in Taiwan 00643 深中小

https://tw.stock.yahoo.com/q/ta?s=00643

When a country's per capita income approach $10K, its people start to be interested in stock.  China is at the stage now.  However, most China ETF contains too much financial institutions, such as the one I hold ASHR, maybe I should switch to 深中小?

VRX a wild ride

It is gut-wrenching to watch my 7 digits investment in VRX going up and down, and down, and up.  Each move adds or wipes a year of income for a typical family.  I tried to make myself above the turmoil and keep telling myself that my strategy will turn out to be right and will have the last laugh with Bill Ackman.  But it is harder than I thought.  Each morning, I check the quote and I have to tune my emotion to deal with day's tasks and other challenges.

http://finance.yahoo.com/news/short-seller-helped-bring-down-193940102.html

Don't know yet.  But the news is turning.

Plan to sell 1/3 when it hits $70, hopefully April 2017.  Will keep the rest and borrow again it to avoid big tax bill.

Japanese Yen JPY and ProShares UltraShort Yen (YCS)

Japanese government has decided that it will devalue the yen, whatever it takes.  Currently it 111 JPY to 1 dollar.  Japanese continue to issue more yen and reduce the interest to the unprecedented negative rate.  Goldman Sachs believe one day, within a year, JPY will collapse.

When it happens, YCS will be the tool to take advantage.  My very speculative forecast, buy it around $75, within 90 days, it will double. We'll see.

The much hated 1%

Really, they are not that different, especially in the USA.  Warren Buffet eats, drinks, sleeps, drives, entertains pretty much like anyone earning upper middle income - $150K/year.  The real difference, according to the Oracle himself, is the long distance travel - by private jet.

To make the 1% income at my age, it should be about $350K annual gross income, with a wealth of about $5M. But I am not sure having those will automatically make people feel like rich.

The real benefit is not worry about lack of money anymore.  The theory is that happiness start to plateau at $70K year and does not make any difference, or sometime reduce the happiness, when the income is above $300K.  I agree.

Swing For The Fences with VRX

VRX is deep trouble early 2016.  Stock dropped from $200 to $30. Its future is uncertain since its huge debt ratio and replacement of CEO.  I drop most of my risk fund to it!  Swinging big time, hopefully this time will be good.

http://www.fool.ca/2016/04/14/should-you-buy-valeant-pharmaceuticals-intl-inc/

Planning to sell 1/3 at $45, 1/3 at $75 and 1/3 at $100.  Will see what happen in the new few months.

Fear and Greed - VRX and KMI

VRX was in deep trouble lately, stock drop from the heights of over $200 to about $30.  But there is a light at the end of the tunnel now, still risky, so I do the thing I distain, day trade on it.  I bought about $290 and sold at $330 within two days. Probably sold too early, but I have to resist the greed.

Bought KMI again today with the news the oil inventory is down and oil price is rising after 9 days of dropping.  Bought $500 at $17.19 and sold $17.62.

US Stock market is a bit over priced now. All eyes are waiting for the FED to raise rate in Apr.  In an environment of rate rising, the stock usually don't do well.  We will see.

One of the simple lesson to learn yet so hard to practice is what Buffet does so well "Be fearful when other are greedy, be greedy when other's are fearful".  Started 6 years ago, I start to learn and condition myself to be in the "buying" mood when the stock market drop, and in the "sell" mood when the stock market rise.  And be bold to bet big when I see real opportunity.

May be I should start a fund call "Fear and Greed Fund"

http://money.cnn.com/data/fear-and-greed/

ASHR big time and $1M

Today's special.  I am getting old but get some new experience.
Sold KMI, LQ and ERUS and now my stock+cash holding is 7 figure.  Compare to the big guys, mine is three digits less, but still a new experience for me.

Yellen decided today not to raise rate this round and only raise it twice this year, which means US currency will not be too strong, world interest rate will be low, stock and real estate will be high.  I dump most of the cash to ASHR today at $23.60, anticipating a big 5% jump in china tomorrow.  Will see.

LQ (11.30X20K) and KMI (17.60X20K) and 1M liquid asset

Decided to take the scary ride and follow Buffet's lead.

The story of KMI, major oil pipeline (I believe our backdoor neighbor is the funder), earning money not by oil price but by how much oil is pump via it pipelines.  The oil price now is low, around $30, but the volume of oil needed is increasing, especially now American is buying more big trucks.  There is no reason for KMI to be beaten down.  The fair price should be around $35, I plan to sell it by July at about $30, $12x20k will give me $240K. That will be nice!

The story of LQ, a Texas based hotel change, was similar to KMI, beaten down because it is in Texas.  It was recommended by an investment manager in NPR Nightly Business Review, it make sense to me (the NPR show often predicted wrong!).  I have been watching it around $10, bought it at $11.30, expect to sell when it is flattened or by the end of the year, for $20, that will get me $180K

the ERUS is not doing well, I got it around $13 now is $11, hi, Putin, work on being a good neighbor!
Plan is to sell around $18, will get $150k, but unlikely now.

The goal this year is to increase the liquid asset to $1M, then I can keep it in the account do wild projects with the earning.  We shall see. $700 + $240 + $180 + $150 = $127.

After working for public university for almost 20 years, I am lucky enough to have a pension to rely on.  I will get about $40k/year starting 2018, enough to live frugally, which I have been doing as a chosen lifestyle.  I believe with $40K pension, $60K from my real estates, $40K from vacation rental, it should be enough. Especially the benefit include health insurance for kids till they are 26.

 

NASDAQ:INVT and NASDAQ:LMFA from a broker long time ago

While I was a grad student and only has 20k to invest, SM called and tried to sell me some small IPO. Some took off and more bombed.  Early Feb 2016 he recommended INVT and LMFA, two very small company with unique business. Not sure I will take the risks into industries that I am not familiar with.

Will keep watch these.

KMI vs ERUS Buffet vs Tao

Buffet and I both see great opportunity in oil lately. I bought Russian ETF, he bought the oil refinery KMI Feb 16th. 

I predict both of us will earn at least 30% by the end of 2016. We shall see who is ahead. 

Gild $125 by 2016 end - growth health care in bear market

The interest rate will be increasing soon. Historically it means stock price will fall, in a longer run. One obvious reason is that there is no longer cheap money to borrow and buy stock. 

One stock Gilead, is growing fast in health care and stock, at 107 and 9.6x of earning, seems undervalued. It time to buy. 

VRX and enough money - NXI, ASHR

VRX had a good pop and I sold it.  A bit too early but satisfied with the earning. Did not buy and NXI, it is dropping slowly.  It is highly recommend by the fool.com, I should look into it. My paypal stock is not doing well, bought at 39 and it is floating around 36-37.  Will have to wait for a longer term.

ASHR is the one I am watching closely, if Chinese economy is slowing down, but still grow at 6%, the stock should have 10--12% up side per year, especially the Chinese Yuan will be considered as international currency soon and the Chinese stock will be also part of international stock market.  There is a clear upside.  I am just waiting for an event or a big drop to enter it.

Financially, things are fine.  There is enough money for kids' education and retirements.  So the question is what else should I spend money on?  Should I become very conservative in my investments since even I get another mil, my quality of life won't be different much.

So how much to get for basic, comfortable in come, I define it as twice the average.  My basic idea:

$24K is poverty limit, three times that is middle class, $72K, three time of that is affluent, $216K.  While I am glad I am lucky enough to surpass that, more is becoming less meaningful.  I am sure I will be as happy earning $120K as earning $400K.  So how to get $10K per month?  My conservative calculation of monthly income at 60.

$3,000 - $4500 from pension
$3,000 - $4500 from vacation rental
$5,000 - $6000 from other rental properties
$2,000 - $3000 from SS
$1,000 - $2000 from IRA dividend

$14K-$20K / month
--------
That's about $160K-$240K per year.  It is enough.  What else do I need? lavish vacation? expensive cars? art collection?  Probably not.

Maybe personal assistant will help?

Invensense NXI VRX

Internet of things will be big - that lead to Fool recommend Invensens multiple times.  Currently at $12.

Valeant VRX is beaten down because of bad publicity, Ackman can't buy enough of it.

Should recommend both?  Probably.

The great secret of all human success - connection

There are many many theory of learning, what make it works, what make it enjoyable.

There are also many theories of happiness, such as in the book I am readying "The Happiness Hypothesis", some argue the happiness is from within, take things as they come, many believe the happiness is from without, getting things we want.

The enpiphy is, all these human enjoyment come from the same source - connecting with others.  

Learning with other students, even those one dislike, is far more effective and enjoyable than learning alone.  Almost everyone unhappy feel "disconnected" "lonely" "isoliated".

Being innovative has to be have rich, frequent and diverse connection with all type of people and ideas.  That is why a society celebrate diversity and loving each other will always out innovate the ones that enforce homogeneity and uniformity.

The good school connect students

and faculty, the great leaders connect all the follower to their mission and to each other.

How to building meanfully and long lasting connect become the secret formula of happiness, and all human achievement for that matter.

Connect!