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We Are Living in the Midst of One of the Biggest Bond Bubbles in History

September 24, 2010 By 8 Comments
McDonald's Bond Certificate Corporate Debentures

Today, I was sitting at the dining room table, drinking a cup of coffee and wearing my Brooks Brothers pajamas watching the stock market skyrocket when it occurred to me that, given the secret project and some other things going on at the business, I want to build some cash and bond reserves at one of the individual operating companies; maybe put aside money a little at a time, let it build and do something fun with it three or four years from now, like design and build a row of townhouses or … [Read more...]

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A $1,000,000 Municipal Bond Dilemma

August 30, 2010 By Leave a Comment
Municipal Bonds and Muncipal Bond Investments

Those of you who follow my writings at About.com, a division of The New York Times, know that I've written about municipal bonds at the Investing for Beginners site including one article that detailed some ways to help you determine if a specific municipal bond was "safe". At the wedding this weekend, I was discussing a family friend, who shall remain nameless, who is in his 80's and has more than $1,000,000 parked in municipal bonds.  As many of you know, this means he earns tax-free … [Read more...]

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How to Marry a Millionaire – An Economic Update on the 1953 Film

August 15, 2010 By Leave a Comment
How to Marry a Millionaire

In 1953, a great movie starring Lauren Bacall, Bette Grable and Marilyn Monroe was released called How to Marry a Millionaire.  I got curious as to how much money it would take to equal the same net worth today so I did an inflation adjustment because I wanted to know how big their motivation was in the film. Turns out, someone who had $1 million in 1953 would have roughly $8 million today. That kind of asset base should generate cash dividends or interest of $34,000 per month without … [Read more...]

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New Jersey Battles Over Millionaire Tax

June 20, 2010 By 3 Comments
New Jersey Governor's Mansion

Think about all the income I earn and my businesses earn.  The sales and profits that are generated 24 hours a day, 7 days a week, 365 days a year.  Guess what?  The taxable income could have belonged to the state of New Jersey.  However, the cost of living, driven in part by the state tax rates, were too high for my liking so I left after roughly five years. Now, the New Jersey legislature wants to pass a tax that will hit 16,000 millionaires by taking 10.75% of their income above $1 … [Read more...]

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Using Cash to Increase Your Value Investing Returns

January 10, 2010 By Leave a Comment
Cash In Your Value Investing Portfolio

One of the least discussed secrets of great practitioners of the value investing strategy is the use of cash, cash equivalents, and bonds to augment returns.  From Benjamin Graham and Warren Buffett to Wallace Weitz and Marty Whitman, intelligent use of excess funds has as much to do with growing your capital over the long run as does selecting individual common stocks.  We're going to look at some of the techniques that have been used by value investors to manage their reserves, and the role … [Read more...]

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Focused Value Investing Strategy

January 9, 2010 By Leave a Comment
Focused Value Investing

The focus value investing strategy is different from traditional, Benjamin Graham value investing strategy because it is based upon the idea of putting money into more of an investor's "best ideas", as Warren Buffett put it.  Some value investors despise focused investing, while others swear by it.  I'm always very hesitant to talk about this particular strategy on Investing for Beginners where I publish my investing articles for total newbies, mostly because some lazy person may not study … [Read more...]

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Why Savings Bonds Should Be In Your Portfolio

December 10, 2009 By Leave a Comment
United States savings bonds Series EE

I am working on more than 50+ pages of new content for the Investing for Beginners site detailing the importance of United States savings bonds; in fact, I'm going to build several huge hubs around it. As odd as it sounds given the boring nature of savings bonds, it's gotten me really excited about these classic investments. Update: The savings bond special is now published at About.com!  Please go check it out.  You can start with the parent savings bond hub, which will lead you into … [Read more...]

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Passive Income Asset Allocation Model Portfolio

December 6, 2009 By Leave a Comment
Passive Income Portfolio Asset Allocation Model

Asset allocation models designed to generate passive income for investors remain among the most popular of all time because everyone wants to be able to live off their money.  Whether you are retired and need to augment your Social Security income, or you are wealthy and want to generate passive income without touching your principal, this asset allocation model may be a viable solution to your investing needs. Asset Classes in a Passive Income Asset Allocation Model The most popular asset … [Read more...]

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Balanced Asset Allocation Model Portfolio

December 6, 2009 By 2 Comments
Balanced Asset Allocation Model Portfolio

A balanced asset allocation model portfolio is one designed to generate a steady combination of growth, income, and capital preservation.  The intention is to create a combination of asset classes that results in lower overall volatility so the investor doesn't need to worry about wild market fluctuations because the holdings in their account mitigate each other to some degree. Sample Balanced Asset Allocation Model Portfolio A typical balanced asset allocation model portfolio may look … [Read more...]

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Capital Preservation Asset Allocation Model Portfolio

December 6, 2009 By Leave a Comment
Capital Preservation Asset Allocation Model

When your primary investment goal is to maintain and protect what you already have, the capital preservation asset allocation model may be for you.  It is designed to reduce the risk of capital loss as much as reasonably possible by having an investor park most of his or her money in safe, protected fixed income and cash equivalent investments.  Although the capital preservation model has its own risks, it can achieve what you intended with a bit of patience and discipline. Appropriate … [Read more...]

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