News

After the Bell Thoughts 4-14

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Quick thoughts based on what pops up on my computer screen as I shut down for the day. I really don’t like this IBM split. I think we’ll get two stocks that lag the market. What I don’t know is if I will still get my dividend. Intel has a 2.17% dividend yield and trades just a bit over its Covid prices… didn’t I hear something about a chip shortage? Bank of America has a 1.81% dividend yield. That yield is insulting for a bank. It’s either overpriced or isn’t paying out a decent dividend. I don’t even know why I looked at Twitter. It doesn’t pay a dividend at all, and I know that. JP Morgan has a 2.38% dividend and is widely considered the best run of the big Wall Street banks. Might be worth a look. Is there ever not a good time to by Berkshire Hathaway? Although I still don’t know what happens when Buffet dies so… Adobe is the 90s Microsoft of its market segment. It’s a monopoly that drains its customers dry. Maybe it’s more accurate to call it the Oracle of the 90s… How long before an imaging mySQL takes down the giant? …

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My Second Stimulus Check

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irs stimulus check

Taxpayers may be getting notifications about their second stimulus check deposit from the government. With all of the news talk about the Democrat’s latest stimulus bill, it can be easy to forget that a second stimulus check was authorized at the end of last year (2020), and that these second stimulus checks have nothing to do with the newest $1,400 stimulus checks that Democrats are currently passing in March 2021. How Many Stimulus Checks Are There? I just got my notification from the IRS about Your Second Economic Impact Payment, aka EIP2. It says it was issued by direct deposit back in January. So, why am I getting this letter now? The IRS loves records, you should keep this letter from the IRS with the rest of your tax records. (I recommend scanning your receipts and other records such as this letter.) Time flies, especially during Covid, but at the end of last year, the U.S. government authorized one-time payments of $600 per taxpayer for taxpayers with an adjusted gross income below $75,000 if filing as individual, and $150,000 for married filing jointly. Those with higher incomes will see their payments reduced or eliminated. This represents the second stimulus payment. …

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New Home Sales and Post Covid Life

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new home sales housing us

Here is a quick bit of news to inform how you look at investing and personal finance moving into a post-Covid world. New Home Sales Rise New home sales were up 19% annually. That is much more than predicted by analysts. There are few trends pushing the higher home sales and those same trends are worth noting across your investing. Covid knocked down the home buying market to basically zero, as showings were banned. Covid also made people more conservative and protective of their finances. Staying put seemed easier and less risky than trying to move. But… Now, as things move toward a post Covid mindset, buyers are looking for new homes. However, there is a very low supply of existing homes on the market, so one of the easy ways to buy a house is to buy new. That means that what existing homes do go on the market are selling for asking price or higher, and selling quickly because of all the demand. This is good news because that experience will lead others out of their cocoon to sell. This news obviously helps home builders, although that still remains a very risky investment. See Is Zelle Safe on …

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Stocks Rise on Inauguration Day

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new president investing strategy

Stocks are racing higher here on Inauguration Day. The question, as always, for us non-day traders is whether or not the day’s news and the stock market’s reaction to it is worthy of our time and attention. Why Are Is The Stock Market Higher on Inauguration Day Does the stock market just love Joe Biden? Not really. However, the stock market does love two things about today. One, is that there wasn’t any sort of violence or disturbance that would signal danger to the forthcoming economy. The second, is that with control of all three branches, Democrats are likely to enact at least some form of additional stimulus, which will help prop up the economy, and more importantly, stave off the reckoning of a possible recession. Washington Can Finally Help the Fed Prop Up The Economy As the Federal Reserve Chairman has been saying to anyone that will listen, the economy is actually on very weak footing right now. Sure, the stock market has been rising. However, the market’s optimism has largely been fueled by the idea that an America on its knees from the unchecked spread of Covid-19 has nowhere to go but up. Behind the scenes, however, is …

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What Else Is In New Covid Stimulus Bill

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new covid stimulus bill details

If you are interested in financial independence, you know you need to watch and manage your money beyond a new $600 stimulus check. You need to know what else is in the new Covid stimulus bill. Here are the new Covid stimulus bill details you need to manage your money. New Covid Stimulus Bill Breakdown New Covid Stimulus Checks By now, you have probably heard about the new $600 stimulus checks, and the fight over whether or not to get $2,000 stimulus checks. Mitch McConnell has blocked $2,000 stimulus checks and runs the Senate like he is the King of the Senate, so that means there is no debate, no compromise, and not chance of $2,000 stimulus checks coming, so don’t bother worrying about that. The $600 is per person, and includes children. So, if you are married with two kids, you can look for $2,400 stimulus checks. It works the same as last time with the IRS using your direct deposit information. If you did something to fix your direct deposit info last time, it should stay fixed for this time as well. There are income phaseouts again to keep the payments from going to higher-income earners. Couples making …

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How Does Antitrust Suit Affect Google Stock Investment?

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The Justice Department has filed its long-expected antitrust lawsuit against Google. The antitrust suit alleges, as they all do, that Google abuses its market dominance to the detriment of smaller rivals. On the one hand, this is an open and shut case. Google is clearly a market monopoly based on any real percentage of users, and there is no real competitor with anything resembling a noticeable market share. On the other hand, it isn’t really Google’s fault that it is the only search engine left. Yahoo, sold its search business to Microsoft following a greenmail attack from an “activist shareholder.” Microsoft itself spends untold millions to build and promote its Bing search engine, it’s just that the company was too late and now everyone is just used to Google for everything. I’ve been experimenting with the Duck Duck Go search engine, but it clearly isn’t funded at Google’s level. Again, that isn’t Google’s fault. Google Stock and the Monopoly Lawsuit How does the antitrust lawsuit affect Google’s stock? It doesn’t. Sure, traders will push the price up and down over events in the courtroom that seem to go for or against the company, but the reality is that a judgement, …

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How Is The Economy Doing?

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congress blame game

When it comes to the U.S. economy there are a lot of opinions. Many of those opinions have motivations behind them that tend to skew their analysis. So, who should you listen to about the economy? Well, you could do a lot worse than the Chairman of the Federal Reserve. The Economy Is Weak The U.S. recovery is weak, very weak. Although jobs are recovering, they are still lower than they were when the pandemic started. The opinion of the Fed Chairman is that the economy needs more help in the form of government stimulus. Of course, the politicians in Washington care more about Dems vs. Repubs than they do about America, so we are caught in petty fights while the economy sputters. Why The Economy Needs Help While politicians, especially the President, love to point to the stock market as proof the economy is doing well, most investors are very skittish right now. Any bad news at all, and they’ll turn into sellers, and take the market with it. Stimulus in the form of extra unemployment benefits has proven particularly helpful to the economy. Why? Because people on unemployment spend that money, and that stimulates the economy. Save money …

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New Home Sales Up During Covid

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new housing

An interesting wrinkle in the new Covid economy showed up today. The U.S. Department of Commerce reported that new home sales in August rose by 4.8%, on top of a spike 13.9% in July. Buying New Homes Overall home sales are having difficulty in no small part because home buyers are reluctant to do several showings in a day in a Covid world. Those showings are what motivate buyers to purchase existing homes. Unlike existing home sales, new homes are typically sold via model homes. Model home are shiny, bright, and seem cleaner, even though more people may actually move through them each day. Furthermore, rather than having to see numerous homes to find the perfect one, buyers need only find a model they like. Builders then allow buyers to tweak that model. Low Mortgage Rates Record low mortgage rates are also helping drive sales for new construction. Unlike existing home sales that are dependent upon subjective appraisals, lenders can easily get a feel for the current value of the one of many new buildings a particular buyer looks to purchase. Is Zelle a scam? Finding a mortgage, however, even for new construction is getting harder. It turns out lenders …

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Fed Says 0% Interest For Years

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future tunnel

According to news reports, the Federal Reserve will signal that its interest rate plan will remain unchanged through the end of 2023. These kinds of “leaks” are typically from Fed staffers trying to lessen any shock ahead of the actual Fed meeting. What 0% Interest For Three Years Means For starters, this is both a bold, and a baloney statement. It’s bold in that stating there will be no interest rate hikes for three years, the Fed is making a prediction about the U.S. economy and where it will be going and committing to 0%. It’s baloney, because if things go well coming out of the whole Corona virus thing and the U.S. economy roars ahead in 2021, or 2022, the Fed will just come out with a new statement saying that economic data dictate a new policy direction. So, what is the point of the Fed’s statement? Investors know how to make money. It isn’t about predicting the future, it’s about determining what the risk is and pricing it accordingly against the possible return. This is a lot easier than it sounds. It requires looking at an impossible number of variables, and weighing each one. In the end, the …

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