Search Bob Brinker Blogs

Sunday, August 31, 2008

Brinker's Predictions Like My Weatherman's

Bob Brinker reminds me of our local weather forecaster. Every day on our local channel, a nice-looking man stands in front of a picture of the United States and loudly proclaims the direction of the wind, possibilities of rain or fog, and what the temperature will be -- high and low -- for the next day.
.
Based on those forecasts, many viewers will decide if they need to wear a coat or cool shirt; boots or sandals; umbrella or sun hat, to work the next day.
.
However many times, the weatherman's predictions are wrong -- it will rain unexpectedly or not at all, gusty wind will kick up, or the temperature will suddenly turn hot or colder.
.
So what does the weatherman do in his weather report the next day? He certainly doesn't mention how very wrong his predictions were the day before. And he wouldn't dream of even apologizing for misleading his followers. Nope, he simply starts all over again with a new set of predictions and recommendations.
.
If anyone suffered as a result of believing the weatherman's wrong predictions, oh well, that was then and this is now. He simply wants to keep his job at all cost. After all, it pays big money.
.
So he puts on a smiley face and voice, and does business as usual with a new forecast. If he loses a few viewers who recall his blunders, that's okay with him too. There are always more where those came from. After all, he is on public airwaves that reach a vast audience.
.
Yes, Brinker has reminded me a lot of my weatherman over the past eight years, but never more than this year -- 2008....
.
.
Here is a transcript of the ad that runs on Moneytalk quite often. It's good advice:
.

"Here's another Vanguard simple truth. Start early, stay the course. Instead of "timing markets" and "chasing trends" we recommend a slow and steady investment approach when combined with Vanguard's costs at 1/6 the industry average, that can mean the more wealth you build, the more you can keep........"

.
.
Vanguard's founder, John Bogle, said: "The idea that a bell rings to signal when investors should get into or out of the stock market is simply not credible. After nearly 50 years in this business, I do not know of anybody who has done it successfully and consistently. I don't even know anybody who knows anybody who has done it successfully and consistently."_________John C. Bogle
.

Saturday, August 30, 2008

Bob Brinker's Moneytalk, August 30-31, 2008

Bill Flanagan replaced Bob Brinker this weekend. Sunday, Flanagan said that in this issue of Barron's, there is a rundown on the expectations for the stock market by nine of their strategists. The average forecast-consensus calls for the S&P 500 Index to end the year at 1363 -- that's about 5% higher than it is now. That's rather conservative, ".....but the good news is if they see muted gains over the next four months, almost all of them see very little limited, further downside for a stock market that's already fallen 11% in 2008, and 16% from October 2007." (In June/July, all of the stock market indexes dropped more than 20%)
.
Bill also spoke about an article by Bill Stone, Chief Investment Strategist at PNC Wealth Management. Bill Stone wrote that with yields on cash and bonds so low, it won't take much for stocks to outperform both over the next 12 months, especially if investors gain enough confidence to deploy their cash stashes. (Go to PNC Wealth Management and enter Bill Stone in their search box and it will take you to his outstanding articles.) Here are some excerpts:
.
Fear of the Unknown
.

Thomas Mann wrote that the active enemy is the unknown—something that investors tend to fear more than even known negatives. One of the largest known negatives—a bear market—has now reared its head. With the market recently breaching the bear market threshold, we thought it might be helpful to answer some common questions regarding a few of the remaining unknowns and to present recommendations we believe investors should take in reaction to the situation.
.

Q: We have officially entered a bear market based on an over-20% decline from the S&P 500®’s October high. How long will this last?
.

Bear markets since 1956 have lasted about 13 months, with a range of 3-31 months. The market peaked in October of last year, so we are already more than nine months into the bear market. The two longest bear markets were marked by higher inflation (1973) and extreme valuation (2000). One cannot really estimate with any precision how long any bear market will last, but we are already through the majority of the duration of an average bear market and well beyond the three-month duration of the 1990bear market, which was marked by financial distress most similar to today.
.

Q: How bad does it get?
.

The worst is typically over when the market reaches the 20% decline. In only two (1973 and 2000) of the past nine bear markets was the S&P 500 lower in the 12 months following the official start of the bear market. The average decline was 31.7%, but the bear markets of 1973, at 48.2%, and 2000, at 49.1%, were by far the worst. In those two cases either inflation moved much higher or valuations were very high at the peak, but we do not believe either of those conditions exists today. If the two extreme bear markets are removed, the average decline falls to 26.9%."
.



Saturday, Bill Flanagan said the following about the stock market: "Almost obliterated the market -- all the news this week about politics -- everybody had something to cheer about, but not on the market. Shares fell Friday -- light week of trading -- not enough to really get the excited about, but the good news was that in August as whole, the Dow added 1 1/2% while the S&P rose 1.2% and the Nasdaq, 1/8%...........Just to bring you up to date, so far this year the Dow Jones Industrials is off 12.98, the S&P 500 off 12.54, Nasdaq 100, 12.19, the Composite Nasdaq, 12.74, the Wilshire 5000 off 11. 45, and the Russell 2000 off 3.46 -- so far for the year 2008."
.
Later in the program, Bill told a caller that he believes the stock market will recover, but he has no idea when....The remainder of the program was so grindingly boring, I had to keep moving to stay awake. 8~) I noticed that the Vanguard Funds advertisement that says they recommend a "sensible buy-and-hold" approach to investing, ran several times today.
.
In the opening monologue, Flanagan talked at length about politics. He almost shot himself in the foot when he started talking about Sarah Palin (John McCain's choice for VP), he almost called her a "young girl." He stopped himself halfway through saying "girl" and said "woman." I laughed out loud, but basically I was VERY offended -- and I'm not radical feminist. I'm just a woman who expects the same respect that is given to men. I've never heard anyone even come close to calling Barack Obama a "young boy."

.

In spite of Mark Hulbert giving Bob Brinker a "mulligan" on his massive and disastrous QQQ-trade of October, 2000, Brinker's Marketimer no longer appears in the Hulbert Financial Digest "Top 5 Performers Through 7/31/2008 -- Total Return Ranking" for 5, 10, 15, 20, or 25 years."

.
My favorite Brinker Historian, Investing wrote about the subject:
.
"............. So Hulbert wants you to buy his rag to see which rag is doing well today. (Hulbert does this for mutual funds as well) And of course there is always some period over some time and with some qualifier that almost every marketimer looks like they are "above average".


Unfortunately just like Brinker you have to pick your times for a marketimer to outperform. Within the last couple months he is wildly bullish and blasting the bears --and within a few weeks we were in a bear market.

Brinker is much of a buy and holder (and sometimes 'hider' if the investment goes badly) so he does not suck as bad as many who make more timing moves. Overtime, it is obvious that just like all the academics say--there is no evidence that Marketiming as practiced by Brinker adds anything but the liklihood of poor performance over the long run.

In 88, Brinker was 100% cash for the only time in his history and a raving bear. Unfortunately the market went up instead of down and he wandered around babbling for 3 years until becoming fully invested again.

Once Brinker started his portfolios performance all over.--a 'do-over" that is never available at the brokerage for people taking advice. :)

In 2000 Brinker first said he was "NOT BEARISH" and left 40% in the market. In August he said he was "bearish" but only took another 5% out of the market. (Recall Brinker always pounded the table that if he was ever bearish he would have nothing in equities)
.

Then in October Brinker told everybody that wanted to make 20-40% in two to four months all they had to do was buy QQQs. So he ended up concentrated in the worst sector--that is still just half what it was in 2000, while the broader market has made investors nearly whole. Following Brinker you had as much as 70% or so in the market in areas that vastly underperformed the general market--TEFQX and QQQqs. So your marketiming hero Brinker's timing sucks.

Now he's no worse than most selling a product that absolutely is worthless and does not work (ask Professor Malkeil--not Hulbert who makes a living selling ratings of which marketimer has the hot hand--totally worthless information as well).

The difference Brinker brings to the table is all the deception.

People today would never realize that following Brinker's advice many should have 5% at cost TEFQX that is down 80% 8 years later and 32.5% QQQQ down 50% after 8 years in their portfolios.

Brinker pretends they don't exist.

Slieght of hand may help hide poor performance and boost ratings (albeit with Hulbert's asterik still there showing the deception 8 years later) --but it doesn't do a damn thing for the poor goober or geezer who trusts the guy.

Brimelow, Hulbert's partner at CBS marketwatch said it best.
"Don't use the rent money or retirement money to invest according to a marketimer. Use only money you can afford to lose"---It's truly just like gambling.__Investing

.

Friday, August 29, 2008

Bob Brinker's "Inverse Correlation" and Missed Bear

Bob Brinker has acknowledged the inability to predict future oil prices. He actually said that only a "fool" would try to do so. At the same time, on Moneytalk, beginning the first week in July after the bear market hit, Brinker began to claim there was a "direct correlation" between the the S&P 500 Index and the price of Oil (later, he called it an "inverse correlation").
.
In the August issue of Marketimer, Brinker wrote: "In summary, we continue to regard oil prices as the key variable for stock prices..........We rate the market attractive for purchase on any weakness below the S&P 500 Index 1240 level. Above that level we recommend a dollar-cost-average approach for new stock market money."

So has this actually happened? Has the price of Oil and the S&P had an inverse correlation since Brinker said that Oil was the "wildcard" on which all of his market-timing forecasts hinged?
  • For the month of July, the S&P declined 1%
  • For the month of July, the price of Oil declined about 12%.
  • For the month of August, the S&P gained 1.22% (8/29/08: 1282.83)
  • For the month of August, the price of Oil declined 6.94% (8/29/08: 115.60)


January 4, 2008, Marketimer, Bob Brinker said: "In summary, the Marketimer stock market timing model indicates that conditions are favorable for the market as we enter 2008. We expect the S&P 500 Index to achieve new highs this year and to reach the 1600's range in the process."

July 26, 2008, Moneytalk, Bob Brinker said: Would the market get to new all-time-highs within your time-frame of 1 to 3 years? Yeah. For me, my opinion on that would be -- without question."
.
Here are some excerpts from comments that were sent to the last Blog article:
.
Pen-name, "Pig" said:
.
1. Brinker MISSED THE BEAR.

2. The Timing Model is qqqquite likely broken. Who is going to trust
the next call?

3. Brinker's poor record for the last 5 years. Not even in the top 5
anymore by Hulbert.

_________

Kirk Lindstrom wrote about how Brinker may again avoid talking about the "missed bear" this weekend:
.
"Here is what my guess is for how Brinker will avoid admitting he missed the bear market this weekend.

He will go on and on about the wise energy policy of VP candidate Sarah Palin! See Sarah Palin - Pictures & Biography for "Palin favors drilling for oil in the Arctic National Wildlife Refuge (ANWR) which McCain currently opposes"

Brinker and his entourage of shills seem willing to talk about ANYTHING but how his timing model

#1 [Brinker] Said there was no bear market in sight several months into this bear market

#2 near the very top at record all time highs, his model predicted new highs for the market in 2008.

#3 Called several buying opportunities at HIGHER than current levels then made yet another at a low level After the market rallied

That is the elephant in the room that he will attempt to cover with oil (talk) this weekend in the hope it slips by."


___________
.
Brinker historian, "Investing" wrote:
.
"Alas I can understand the angst if I had to alibi for Bob Brinker's Marketiming. He just missed a big bear. He admitted that he cannot predict the equity market. He claims it is totally dependent on oil prices and nobody can predict them. This coming week we will learn that his predictions are also dependent on the weather -- which affects greatly oil prices and thus is another stake thru the heart of the marketimer.
.
When you think about it--there is nothing quite so silly as claiming you can predict the equity market with accuracy that would cause one to rotate into and out of stocks profitably.

Marketiming advice requires the art of selling a service that does not work:

  • Is the best way to vastly under perform the stock market return

  • Requires a crystal ball

  • Risk adjusted return-is a marketing term and refers to the performance after you hide the worst performing investments

  • Does not work if you cannot predict the price of oil. "Nobody can predict the price of oil"-Bob Brinker

  • Works best when major recommendations can be dropped and hidden from performance

  • Requires shills to obfuscate the exposure of the game on the internet.

  • Has not one single academic financial expert recommending it as a rational approach to investing.

  • Has not one author of a mainstream financial book that recommends marketiming.

  • Calls of marketimers who have radio show tend to morph over time. "I am not bearish" --in January 2000 becomes "When we became bearish in January 2000".

  • It is very easy to make a million dollars in two to four months with marketiming. The key--start with two million dollars.___Investing

Thursday, August 28, 2008

Bob Brinker's Disappearing-Ink Blunders

Bob Brinker's definition of a bear market is a 20%+ decline in the S&P 500 Index. Bob Brinker has never successfully (totally) side-stepped a bear market, and he has now missed three of them.
.

  • 1. October 1987: Brinker 100% invested and bullish.

    2. January 2000: Brinker 40% invested and said the market was "unfavorable" until August 2000.

    3. June (worst June in 50 years) and July, 2008 (20%+ decline): Brinker 100% invested and bullish.

.
Bob Brinker made several costly blunders over the years that seem to have been written in disappearing ink. Long-term Brinker-historian and expert, Investing, wrote about some of them:
.


"Perhaps this exchange shows why Marketiming Ragsellers should never be trusted and any claims of performance are at least in Brinker's case PURE D BS.
.
I, apparently like Honey, recalled Brinker's move in January 2000 differently............ Brinker took a little over half out of the market in Jan 2000 (60%)................
.
I did not think there was a link to Brinker's allocation model for the highly touted TEFQX recommendation. Perhaps nothing other than the QQQ ACT IMMEDIATELY bulletin received as much hype after UTEK fizzled than Brinker's love affair with B2B and TEFQX, and the First Hand fund guru Landis. Now this man [Brinker] that alibi artists today want to describe as "bearish" in January 2000, had on his site a very active discussion thread on B2Bs. His son, the Junior Pup, at the time had company after company listed in the B2B space that the Brinker's were excited about, claiming it was "in the early innings".
.
Even the hatchetman for Brinker who also had a thread on Brinker's site, Justa, warned Junior he had better calm down the hype he was creating on Brinker's site for these B2B funds and stocks. Indeed it was a way one can prove unequivocally that Junior was posting on this site. Justa was urging him on this site to put some disclaimers on the hype Junior was using to pimp this "space".
.
On Brinker's site you had people long past retirement trading B2B stocks like it was a bingo parlor. It was as if Brinker was only saying "the old economy stocks" are going down; but "my call has nothing to do with the Nasdaq". He said that many times as the Nasdaq went up after his call and never warned of any problem with the bubblemania that was developing. Indeed every month - Jan Feb and March he had glowing praise for the TEFQX fund in the newsletter that now the alibi artists want to portray as bearish.
.
Math pointed out that people acting on Brinker's hype (this was both on the radio and in the newsletter in addition to on Brinker's website) to buy TEFQX were supposed to sell other stock/fund holdings to purchase it to stay within the allocation guidelines. This would mean that lets just say a person had his portfolio I allocation as it is today, to comply with the guidelines and purchase TEFQX, he would have say sell some of the index fund in the portfolio I to buy the TEFQX. With all the hype and the warning is that "for those who can accept volatility" and the near hysteria about this B2B "space" that the Brinker's were creating, no doubt many people did this.
.
So Brinker kept TEFQX as a buy until the spring of 2001. It had fallen from a high of 18.00 to under 4.00/share. Brinker that month moved TEFQX to a "hold". It was NEVER MENTIONED AGAIN.
.
So Math obviously knew that. He was quick to point out a paragraph where Brinker said that TEFQX was to be fit inside that 25% allocation to US equities. It is obvious that would cause someone to buy that with monies in funds in the model portfolio if they wanted to participate in this "best" idea of Brinker--he spent a whole page touting this as the best thing since sliced bread at the same time reducing the allocation to equities.
.
......................
Math claims it was a recommendation to be put in the 25% left in equities. It would count on one's portfolio performance every bit as any other recommendation if using REAL MONEY. This was a totally boneheaded pick. It dropped 90% during the bear market and now is around 4 bucks 8 years later. As Math surely knows; Brinker NEVER closed out a position for up to 5% of an entire portfolio. He just moved it to a HIDE.
.
Not at all unlike the QQQ debacle in which Brinker sent an urgent message to all subscribers to ACT IMMEDIATELY if they wanted to make "20% or MORE GAINS IN TWO TO FOUR MONTHS" . I would submit almost everyone would want to make 20% or more gains so the alibi "for those who want to take advantage of this opportunity" excluded anyone is silly. But the truth is that Brinker, in that missive, recommended up to half the money taken out of the stock market including all stocks, all mutual funds in and out of model portfolios to be used to buy QQQs.
.
He tenaciously held this position from the $80s where the Qs traded in Oct 2000, all the way down to $19 and change. He has NEVER ISSUED A SELL on this position for up to 1/3 of a portfolio that is still down about 50% 8 long years later. He hides this position from any mention in his performance. He very deceptively added 25.00 QQQs to each portfolio when he made his March 2003 portfolio and has pretended on the radio that is the only QQQs he has recommended.
.
What this shows and what Math knows--Brinker is slick and deceptive. He recommended TEFQX for up to 5% of a portfolio--a specific recommendation with specific parameters within the 25% of US equities. He kept it as a buy for a year. It tanked. It disappeared from coverage and the position was never closed out.
.
With the QQQs he used the monies taken from equities, including model portfolios, and urged subscribers to buy and hold QQQs to this very day. After Feb, 2003, however like with TEFQX, Brinker never speaks of the recommendation that represents a considerable portion of someone who followed his advice to the letter to this very day. Only an asterik in Hulbert and a few posts on the internet keep people like Brinker, and [a few others] from hiding this most deceptive way of accounting for financial advice.
.
I want to know where people who took Brinker's advice can go to a broker and drop investments that fall 80% from their portfolio, get there money back and invest the same money again without accounting for the loss. Brinker takes mulligans and pretends bad advice has no impact. That is the secret to fooling people in believing he is a successful financial advisor.__Investing
.
Fun Stuff, Seabiscuit's Brinker-Shaves
.
He attacked the bears

Again and again and again

Then he bought the QQQs

And went down the drain

Brinker Shave!

********

Let me tell you, Ms. Bee

How I beat Warren B

I bought more than a bag

Of Bob's timing rag

Brinker Shave!

.

Some peaceful beauty


.

I took this picture on one of my morning walks. Don't miss the ducks. Babies are hiding in the Lotus:
.


.

Brinker's Portfolio Takes Over 20% Hit

Bob Brinker was a raging bull as the year 2008 began. He was forecasting that new highs would occur in 2008! He was forecasting that the S&P 500 Index would reach the 1600's in 2008! He had been repeatedly recommending the S&P 500 Index level "mid-1400's" as "attractive for purchase" for those who happened to come into new money to invest in equities.
.
When the correction hit the first week in January, he mentioned on Moneytalk that it was more than he had "expected." (That was rather the understatement in light of what he actually had been expecting. LOL!)
.
January 20th, Brinker canceled his long standing "mid-1400's" buy level and continued to recommend dollar-cost-averaging new money into the market.
.
February 10th, 2008, Brinker issued a lower "attractive for purchase" buy level at "low-1300's" and later bragged that the March lows were the "bottom" he'd been looking for. (Note that this was the third buy level that Brinker had recommended in less than a year.)
.
April 4, 2007 Marketimer (S&P 1424) Bob Brinker said: “Marketimer currently rates the stock market as attractive for purchase during periods of weakness in the vicinity of the S&P 500 Index 1380 level or lower.”

.
January 4, 2008 Marketimer (S&P 1468) Bob Brinker said: “ We continue to rate the market attractive for purchase on any weakness into the S&P 500 Index mid-1400’s range."

.

May 10, 2008, Brinker said the following to a Moneytalk audience:
.
"Look, we have people on the program that have different views than me, I’ve told you……I mentioned last week we had a recent guest on the program back when the market was at the lows – when the market was down around 1300 in the S&P……..he was bearish as a (unintelligible) bears. And I remember telling the audience, I said look, it’s a free and open exchange of ideas. This is not my view. I happened to be very bullish at that time.

.
In fact, at that time, I happened to have a buy signal on the market when the market was down around 1300. But he was coming with his bearish views………”

.

Moneytalk, May 31, 2008, Brinker was busily bashing the "bad news bears" and "cassandras," while the S&P 500 was at 1400 and $Oil was at $127 per barrel.

.

In June and July the Dow, S&P and Nasdaq all dropped precipitously into bear market territory. How did Brinker respond? On Moneytalk, he did not mention the bear market (he never has mentioned it on Moneytalk), but in Marketimer, he issued a THIRD and LOWER "attractive for purchase" buy level at "weakness below the S&P 500 Index 1240 level," with NO further word about of the prior, higher buy levels. Throughout all this time and all these changing-lower buy levels, Brinker has recommended dollar-cost-averaging new money into the stock market, and his model portfolios I & II have remained 100% in the stock market.

.

Additionally, as a response to the "official" bear market happening, Brinker began to claim that the S&P was "directly correlated" and "inversely correlated" to the price of Oil. He said that his market forecasts were dependent on the oil "wild card" and that only a "fool" thinks he can predict the future price of oil. (Brinker excerpts)

.

August 5, 2008 Marketimer, Page 3; Paragraph 3; for the first time ever in his newsletter, Bob Brinker said: "In Summary, we continue to regard oil prices as the key variable for stock prices."

.

May 31, 2008, the S&P 500 was at 1400 and $Oil was at $127 per barrel.


As of today, the S&P is at 1300.68 and Oil is 115.61


Anyone see an "inverse correlation" so far?



.

Tuesday, August 26, 2008

Were Bob Brinker's Market-Timing Forecasts "All a Charade"

Long-time Brinker expert, InvesTing, comments on my Moneytalk Summary and Bob Brinker's latest market-timing advice.

.

Another reason I see people who have stuck their neck out defending Brinker have changed to bragging on his fund picking ability as a buy and holder was his flip flop this last weekend I saw on Honey's Blog.

.

If I read it right Brinker took a call from someone who thought it might be wise to sell now and buy back next year at lower prices.

.

Brinker seemed to get his britches in a wad and took great exception to this guy's marketiming idea.

.
Strangely he said that unless the guy knew with absolute certainty where the market would be in one year it was a dumb idea. He seemed to allude to the fact that anyone predicting what the market would be doing a year from now was pure guess or speculation.

.

Just looking at Honey's summary; Brinker gave the guy the bottomline reason that marketiming pretty much sucks as an investment strategy and why Brinker I believe is a buy and hold forever guy these days who will never go to 100% cash EVER.

.

Now it seems Brinker is really having a hard time keeping his stories straight. I recall he claimed last fall when the market was at the highs that his prediction was that we would be in the mid 1600s and all time highs this year. OOPS.

.

With the market off considerably he simply (like he did with UTEK and the QQQs) changed the time frame for his new all time highs and 1600s prediction to 2009.

.

Yet he alluded to the caller that making such predictions were stupid unless you could know with absolute certainty he seemed to tell the caller you should be a buy and holder becasue he said you might have to buy the market at higher prices.

.

Huh? Isn't that what Professor Malkiel said? Isn't that what all legitimate academic studies of marketiming schemes have come up with? The future is unknowable and so much so in the world of equity investing to make marketiming unsuccessful.

.

So in just the last few months we have the same person Bob Brinker.


    • 1) Claiming we would have new all time highs this year.

      2) Claiming we would have new all time highs next year instead of this year

      3) On May 31 2008, claiming the lows were in during march 2008 and it was clear sailing. Said those that were bearish should be embarassed and hammered them with insults like "false prophets" and "cassandras". (oil was at 130/brl S&P at 1410)

      4) A couple weeks later with the market plummeting Brinker claimed that the equity market was totally dependent on oil price and nobody in the world could predict the price of oil

      5) Within a month of Brinker's "false prophet" /Cassandra speech the market was in bear market territory. 6) The price of oil has plummeted about 15.00 a barrel from the price when Brinker was extremely bullish and the market was at 1410. The market now is at 1265.

If Bob Brinker says that the market is totally dependent on oil prices and nobody can predict oil prices, he has admitted there is no way he can ever predict the market--is that not the case?

.

Bob Brinker has made predictions for a year out repeatedly, yet now seems to say that nobody can do that. So was it all a charade?

.

The believers in Brinker have totally come off the reason to buy his marketiming newsletter to get marketiming advice, but now claim that his fund picks (though much of his portfolios are indexed) are the reason you buy the now buy and hold through bear markets advice.

.
Does anyone else think that the "message" from the Brinker camp is in bad disarray?___InvesTing

.

Sunday, August 24, 2008

Summary: Bob Brinker's Moneytalk

Summary, Commentary and Moneytalk Excerpts, August 24, 2008

.

Bob Brinker did not discuss nor comment on any stock market activity today -- and he made no forecasts. The only time he referred to the stock market was when a caller asked about selling his stock now and buying it back a year later. Brinker asked him why he would want to sell stocks now that the market is “off its highs," then Brinker said: “I see it differently from you…….[I see] that a year from now if you wind up putting that money back into the equity market at a higher level than you’re getting out, then you will have foregone that profit………the only way you could answer your question would to be absolutely be certain where the equity market will be in one year. And if you have a way to actually know where the S&P will be trading in a year with guaranteed certainty, well then obviously you’re operating on a whole different level. But for those of us, even those of us who try to forecast where the market will be going forward, to make a statement that you know that a year from now it will be at this level, that’s pretty tough country to operate in because it requires an operable CRYSTAL BALL.”

.
Today, there was lots of political talk, GNMA talk, some repeat data about inflation, and several very personal questions from callers that received lengthy answers.

.
A caller who wanted to know how much one could “low-ball” an offer when buying a home. Brinker explained that it was certainly a buyer’s market, but she should check comparables in the area.

.
NOTE! Brinker told a caller that if the government does bail out Fannie Mae and Freddie Mac, it might mean that the common stock will become worthless.

.
Brinker repeated what he has said previously about the certainty of Obama raising taxes if elected. Much of what Brinker said was almost a verbatim repeat of what he said on April 5, 2008 -- as I recorded in my Summary that weekend. Here are the excerpts:

.

Bob Brinker said: "The most likely nominee based on the current polls, subject to change, is Barack Obama………Barack Obama stands firmly on raising the marginal tax rate on entrepreneurs to levels not seen since John F. Kennedy………..he’s talking about a potential marginal tax rate of about 60 to 63%........Now I think with a marginal rate of 60 to 63%, I think that a lot of entrepreneurs will take a page out the old Johnny Paycheck Songbook, ‘Take This Job and Shove It, I Don’t Work Here Anymore.’ That line made the late, great Johnny Paycheck famous and it may make Barack Obama famous too, to a lot of entrepreneurs who may take up golf. Because the bottom line is if you are confiscating 60% or more of somebody’s compensation, in a lot of cases, they’re just going to find something else to do with their time.”

.
Brinker continued by stating emphatically that this was a gigantic misstep in Obama’s campaign, and that he may get away with it with people who don’t know any better or understand where the jobs come from, but he was not going to get away with it with him.

.
Brinker went on to explain how easy it would be to construct this 60%+ marginal tax bracket for a lot of American entrepreneurs who create jobs. Firstly, Obama and Clinton will very quickly get the top federal rate up to 39.6 after inauguration – as soon as they can get it through congress.

.
Obama has made it clear that he likes this donut-hole Social Security plan that he has come up with. Brinker described Obama’s “donut hole” plan: “This is the plan where, right now you have the $102,000 cap on the Social Security tax. This is the 6.2 plus 6.2, which is 12.4 to the entrepreneur and business owner…….everything above that not subject. Well, he has this donut hole idea, where you create maybe a $100,000 up to $200,000………. where you don’t do anything right now………where you don’t make any changes. Then he sinks the battleship when the donut hole is finished. Because above $200,000, the Junior Senator from Illinois, in his na├»ve notion of how jobs are created and economics works, is talking about lifting the cap on Social Security……..So we have the 39.6 and we have the 12.4, so all of a sudden we’re up to 52%. And the 2.9, the cap is already lifted on Medicare…….now we are up to 55%. How many entrepreneurs do you think live in places that charge high state taxes………now you are up to 62%, depending on the state you choose. A 62% marginal tax rate on entrepreneurs. This is the policy that Barack Obama is talking about.”

.
Brinker commented that he thinks Obama may get away with this because entrepreneurs don’t elect presidents – they are elected by “rank and file.” However, Brinker thinks it is one of the worst economic policies that he has ever heard out of a presidential candidate, and he believes that if Obama doesn’t change his “donut hole” policy, then
he is running a “dreadful, dreadful” presidential campaign -- because he will be attacking the “core growth engine for new jobs in America.”

.


Brinker’s guest speaker today was Richard Thaylor, who co-authored, Nudge: Improving Decisions about Health, Wealth and Happiness

.

.
Pen-name Stoxnbonds from Facebook wrote a "Brinker-Shave" enjoy... 8~)

.
More poems. Enjoy!

The streak of good calls
Has come to a halt
Now all he can say
Is it's oil's fault
Brinker Shave!

The market direction
Is going the other way
So Money Talk is reduced
To nukes and Ginnie Mae
Brinker Shave!

When the timing model
Misses the mark
Radio listeners
Are left in the dark
Brinker Shave!

.

.



.

Saturday, August 23, 2008

Bob Brinker's Botched Bear Market Advice

Bob Brinker was replaced on Moneytalk by Bill Flanagan this weekend, which seems odd to me since it's only been two weeks since Flanagan replaced Brinker on August 9-10. And isn't Labor Day coming up? Brinker usually takes holidays off.

Bill only made two comments today that might be of interest to some of you. He told one caller that it was too late for long-term investors to bail-out of the stock market. And he made this comment: "Inflation is out there, as we all know -- eating us alive like gnat bites." That is exactly opposite from what Bob Brinker says about inflation. The remainder of the 3 hour program was devoted almost exclusively to energy and political talk.
.


Bob Brinker has basically bungled his market-timing advice since June 2007, and he has simultaneously remained 100% invested.
.
Pen-name, Pig, said: "THE (infamous) TIMING MODEL IS BROKEN!! IT DOES NOT WORK. IT DID NOT KEEP THE SUBSCRIBERS FROM MISSING A BEAR, WHICH HE PROMISED!
.
He (((ROARED))) at Buy-N-Holders, and he became one AGAIN, along with the QQQQ and TEFQX." (Please see comments section in previous article for all of Pig's comments.)
.
Honeybee replied to Pig: Brinker certainly did have a good time bashing the "bad news bears," "cassandras," and the "false prophets" back on May 31st when he thought the March low was the bottom.
.
The other "elephant in the room" is the fact that his timing model not only missed the bear market, but it must have contributed to his mistakenly calling the bottom and issuing a new, lower, buy-signal (low-1300's) in February.
.
Oops, then the market just continued on down into bear territory -- the S&P nipping at 1200.
.
Now Brinker has issued a new buy-signal (1240), and only time will tell if that will hold and he will finally have found a bottom."
.
.
Pen-name, InvesTing's, entertaining and accurate commentary on Brinker's botched and bungled bear market-timing calls.
.
"Wow, it looks like all departments in the Brinker business are busy trying to change the subject to anything but marketiming and his performance. Queen Peanut Butter and the department headed by the alias Midwest Investor have been quasi successful in the Biden approach to changing the subject and burying the sad tale that is Brinker's yammering.
.
They know and cannot dispute that Bob Brinker has never successfully predicted a bear market in his life.
.
They know that Bob Brinker missed this bear market and has never admitted there was/is a bear market.
.
They know Bob Brinker totally embarrassed himself with his rant at near the beginning of June calling those pessimistic about the market "False Prophets" and "Cassandras"
.
So it is no wonder that the multi alias shills are busy busy busy trying to be sure that someone doing a search don't find the truth.
.
Anyone want to wager on Crazy Bob admitting there was/is a bear market this weekend?"
.
Honeybee wrote:
.
"Bob Brinker's market-timing calls paraphrased:

August 2007 through January 20, 2008:
.
If you have any new money, inheritance, retirement, lotto winnings or house-sale proceeds that you want to invest in equities, mid-1400's is a gift-horse buying opportunity.
.
February 10, 2008:
.
If you have any new money, inheritance, retirement, lotto winnings or house-sale proceeds that you want to invest in equities, low-1300's is an attractive for purchase level.
.
August 5, 2008:
.
If you have any new money, inheritance, retirement, lotto winnings or house-sale proceeds that you want to invest in equities, any weakness below the S&P 500 Index 1240 is an attractive for purchase level.
.
June, 2007, Brinker said that the "secular bear megatrend" (which he claimed was running concurrently with a "cyclical bull" market), had ended the prior year (as of June, 2006).
.
January 4, 2008 (S&P 1468.36) Bob Brinker said: “We expect the S&P 500 Index to achieve new record highs this year and to reach the 1600’s range…….attractive for purchase on any weakness in the S&P 500 Index mid-1400’s range.”
.
Bob Brinker is 100% bullish, 100% invested, and before the stock market dropped into bear territory he stated on Moneytalk, that there is no bear market and that he did not expect one.
.
Brinker has never acknowledged on Moneytalk that he believes the market is now in a secular bull trend and that in July the S&P dropped into (his own definition) of a bear market."
.


Wednesday, August 20, 2008

Bob Brinker's S&P and $Oil "Inverse Correlation"

As Bob Brinker said about the market last Saturday: "It was no big deal one way or the other, but on balance, it had a decent week." I sure don't see much "inverse correlation" in these numbers. Wonder if anyone believes this premise is true?
.
Last Friday, the S&P 500 closed at 1298.20: This week it dropped to 1292.20 -- down 0.44%

Last Friday, $Oil closed at 113.75: This week it rose to 114.65 -- up 0.76%
.

Tracking Bob Brinker's claim that there is an
" inverse correlation between oil and the S&P 500."
.
July 13, 2008 (S&P 500 @ 1239.49 -- Oil at 144.95) Moneytalk Bob Brinker said: “One of the topics we’ve been talking about on Moneytalk is what has been going on in the stock market and how that has been related to the price of a barrel of oil and the correlation that we’ve been discussing on Moneytalk. I think the stock market really is marching to the drummer known as oil right now. I think oil prices are the ax right now in the stock market." (Honeybee EC: As my Summaries clearly show, Brinker first made the Oil/S&P connection the first weekend of July. And the July issue of Marketimer was the first time he wrote about it. Before that, he always talked about the price of oil as it pertained to inflation. He has always claimed that rising energy prices were NOT inflationary.)

.
Monday, August 18, 2008:

  • S&P 500 Index closed at 1278.60 -- down 1.51%
  • Oil closed at $112.87 -- down 0.77%
Tuesday, August 19, 2008:
  • S&P 500 Index closed at 1266.69 -- down 0.93%
  • Oil closed at 114.53 -- up 1.5%
Wednesday, August 20, 2008:

  • S&P 500 Index closed at 1274.54 -- up 0.62%
  • Oil closed at 114.98 -- up 0.39%
Thursday, August 21, 2008:
  • S&P 500 Index closed at 1277.72 -- up 0.25%
  • Oil closed at 121.32 -- up 4.98%

Friday, August 22, 2008:
  • S&P 500 Index closed at 1292.20 -- up 1.13%
  • Oil closed at 114.65 -- down 5.39%



Some Fans of Seabiscuit's Brinker-Shave have chipped in with their own Brinker-Shaves.
Enjoy: 8~)

.
Jody said...

I love SeaBiscuit's Burma Shave idea, so here's my two cents:

He timed well in 2000 and 2003
Was it just luck, or real wizardry?
I stuck with the program, but now it’s certain,
His model doesn’t work, and my IRA’s hurtin’

Brinker Shave
.
***********
.
Blogger Tom T said...

I loved the Brinker-Shaves by Seabiscuit. As one who has had his portfolio "shaved" by following the Marketimer, may I offer the following?
*******************
Save your 185

The Cassandras yell,

Why only buy

And never Sell?

~Brinker-Shave
***************************


Theres bears ahead,

Remember Sonny

That Marketimer

Didn't save the bunny.

~Brinker-Shave
**************************

The Marketimer

Will let you down

Quicker than

A Strapless Gown.

~Brinker-Shave
*************************

Many a fortune

Used to stand

Where the Marketimer

Got out of hand.

~Brinker-Shave
*******************************


In this valley

Of toil and sin,

Your portfolio grows bald,

But not your chin.

~Brinker-Shave


Honeybee, thanks for this site -- and my apologies to Burma-Shave.

Tom T.

August 20, 2008 12:14 PM

.

Tuesday, August 19, 2008

Bob Brinker Claims Oil and S&P "Inverse Correlation"

Tracking Bob Brinker's claim that there is an " inverse correlation between oil and the S&P 500."

.
Monday, August 18, 2008:

  • S&P 500 Index closed at 1278.60 -- down 1.51%
  • Oil closed at $112.87 -- down 0.77%
Tuesday, August 19, 2008:
  • S&P 500 Index closed at 1266.69 -- down 0.93%
  • Oil closed at 114.53 -- up 1.5%
.
This Oil price-rise is largely blamed on what is happening with the Dollar. Marketwatch: "Everyone got nervous when the dollar broke though key support."
.
.
Click the graph to see full sized chart by Kirk Lindstrom showing Oil Prices
XLF = Financial Sector Spider in blue on the graph. The market seems to "correlate" much better to what is happening with the banks than with oil. Funny Brinker fails to notice this.
.
.

Honeybee here: Kirk makes a good point about the financials. Here are some interesting excerpts from a commentary by someone who agrees with Kirk.
.
David of The Shark Report Blog wrote:
.
"According to Bob, oil is the key to the markets and not the financials- I definitely do not agree- guess I have facts on my side now as oil has fallen from $147 to $112 and the markets have barely moved off the 1216 closing low in mid July.
.
Bob says the following in his (August, 2008) letter:
.
In summary, we continue to regard oil prices as the key variable for stock prices. Lower oil prices combined with low interest rates would provide the basis for an improving economy next year. We believe such a scenario would be embraced enthusiastically by investors. We rate the market attractive for purchase on any weakness below the SPX 1240 level. Above that level we recommend a dollar cost average approach for new stock market money.

.
Go here to read all of David's comments (and see a recent picture of Bob Brinker) The Shark Report

.
Fun Stuff
My Idaho sister-in-law, who is always reminding us about the traffic we have here in Caleeforrneea, sent this picture of the traffic that was following them near Banks, Idaho. 8~)




.
Brinker-Shaves, written by SeaBiscuit:
.
Buy it at 1200/1100/900...

Never mind the knuckles turning white

Cuz one of these days/months/years...

He's eventually gonna be "right"!

Brinker Shave


*******************
The next buy level is no secret

Now that Brinker has blundered

It will be a few dozen points lower

At the next lower hundred

Brinker Shave!

.

Saturday, August 16, 2008

Summary: Bob Brinker's Moneytalk, August 16, 2008

Summary, Commentary and Moneytalk Excerpts, August 16, 2008

.
Bob Brinker’s opening monologue paraphrased:

.
Stock Market:
Covered later.

.
Ten-year Treasury Bond at 3.85% -- Ten-year Inflation-Protected Security base rate at 1.66% – a differential of 2.2%, which represents the implied inflation rate for the next decade.

.
Thirty-year Treasury Bond has a 4.47% nominal yield – interest paid semi-annually. Base rate on TIPS 2.07% —a thirty-year implied inflation rate of 2.4%

.
Headline inflation has been elevated – Core rate very low at 2 ½% on CPI and less on the PCE. The PCE Index is favored by the FOMC.

.
Housing Market: Brinker cited a study by the Columbia Business School. Brinker gave several “statistics” about over-valuation and under-valuation of real estate in different cities and areas. He said the study indicated that San Francisco and San Diego California are under-valued by 1%; New York City 5% under-valued; Detroit, Michigan 12% under-valued. Miami and Phoenix both at 13% over-valuation; Chicago 11% over-valued; Tampa 9% over-valued; Minneapolis 7%; Los Angeles at 6%; Atlanta, Washington and Denver at 5%; Charlotte NC at 4%; Boston 3% over-valued. (Honeybee EC: Yesterday I asked for help finding the link to the study that Brinker cited. A helpful reader sent it to me this morning and I want to sincerely thank him.)
.

Calculating Where Home Prices Will Land, New York Times

Percent Overvalued, New York Times

.
Brinker said that there has been a small pick up in the number of RE sales – all price related -- not because of the economy, which is soft.

.
Economy: Real Gross Domestic Product growth annualized from the start of this year is at 1.4%. Brinker said that his forecast for this year was between 1 - 2% for calendar year 2008.

.
Mortgage Rates: In a relatively narrow range, but have inched up a bit -- 30-year fixed rate is now 6.64%. In January it was at 6%.

.
Housing Recession: Is ongoing and will take time to work out. If construction stopped today (which it won't), we have a 3-5 years supply of housing on the market. Brinker said that IF we see the economy starts to get better in 2009, the housing market could start to improve.

.

Saturday Moneytalk Calls:

.
Caller: Asked if there is any possibility for the U.S. having a balanced budget? Brinker said there is no chance of a balanced budget happening because congress is “out of control”-- even after two years of a democrat majority. Both parties continue big spending and show no fiscal responsibility.

.
Caller: Asked what Brinker thought of her giving her daughter $300,000 -- which was half of her net worth -- to help her daughter pay off her mortgage. Brinker said he certainly would not recommend that she do that – instead she might want to help her daughter make her payments.

.
Caller: Asked about GNMA Fund NAV fluctuations. Brinker told him that GNMAs have a direct guarantee from the U.S. Treasury to repay principal and interest. This does not apply to Fannie Mae and Freddie Mac. Brinker recommends Vanguard GNMA Fund. The 52-week change has been between $10.07 - $10.55 and is now at $10.24 – in the middle of the NAV range.

.
Caller: Asked about Brinker’s political involvements. Brinker answered: “I have made no contributions to any political candidates……..and number two, I have been and remain a registered independent voter.”

.
Caller: Explained that his financial management company said they wanted to move his money to a different financial management company because they could make faster moves. Brinker suggested that the caller simply invest in broad-based funds, such as the Total Market Index in order to completely eliminate the risk of under-performance and to get high tax efficiency and low expenses. Then Brinker said to the caller: “I want to give you credit because I think you’re right to be cynical. When somebody comes to you like this and says we want to switch it over, first of all, let me give you my reaction to the reason you were given --they can react more rapidly to the financial markets than we can --well I have to be honest with you, when I hear excuse like that for making this kind of change, it sounds to me like it might be a very lame excuse. And I’m putting a smiling face on it, it might be worse than that. It might be complete bull-bleep. Can we talk mano-a-mano here? Bull-bleep! That’s what we might be talking about here. But best case, it’s very lame……”

.

Hour Two
.

Brinker talked at length about the dramatic changes at auto-dealer's lots because of the near doubling of the supply of low-mileage cars, such as the GMC Yukon, Excel, Suburban, Ford Explorer. He also talked about the dramatic shrinkage of the supply of high-mileage vehicles such as the Ford Focus, Chevrolet Cobalt and the Toyota Prius. Many people are struggling with making a decision about buying lower-mileage vehicles, but suffer sticker shock when they see the low value that they will get on trade-ins. In many cases, the loss is so great that it's best just to continue to pay the high gasoline prices.

.
STOCK MARKET......Bob Brinker said: “Standard and Poor’s 500 Index standing in at 1298.20 – tacked on a few points for the week -- had a decent week. It was no big deal one way or the other but on balance, it had a decent week. We certainly have seen a decline in oil prices since mid-July. Oil prices have come down from the $147 area to the $114 area during that period of time going back to the 15th of July. You may remember back then the S&P 500 closed at the 1215, now setting up at 1298. Remember we talked on Moneytalk about the inverse correlation between oil and the S&P 500. Well there you have it in black and white. Oil down from $147 and to $114 -- S&P during that period, up from 1215 to 1298.”

.

(Honeybee EC: Brinker first began talking about the “direct correlation” -- which he is now calling an “inverse correlation” -- between the price of oil and the S&P 500 the last week of June – the worst June for the S&P in over 50 years. Brinker continued to use this new market-timing element during the month of July – the month when the S&P dropped firmly into bear market territory – a fact that Brinker has never mentioned either on Moneytalk or his Marketimer-newsletter.

.
Some might wonder if it’s all just an excuse to justify the fact that his timing model, which is theoretically supposed to predict when a bear market is coming, did not anticipate the markets intermediate correction or the bear market correction. Indeed, Brinker failed to call the bottom of the correction correctly.

.
You will recall that on Moneytalk, he claimed that the "March lows" were the bottom of the correction and said that his had issued a new "attractive for purchase" level in the low-1300s in February. April 19th Moneytalk, Brinker said: '"When we saw that weakness on the correction test into the low-1300’s and that very, very minor weakness that we had just below that level for a very short window of time, I was doing the same thing that John was doing – which was adding to positions."

.
Now, Brinker has arbitrarily chosen a time-frame from the middle of July to make his case that he was “right” about the S&P and Oil correlation being the cause of the bear market. Pardon me and with all due respect to Mr. Brinker, doesn’t that seem a bit silly?

.

Let’s back up and take a look at the whole month of July:
  • For the month of July, the S&P declined 1%
  • For the month of July, the price of Oil declined about 12%.
Now let’s look at the month of August (so far)

  • August 1 – 15: Oil declined 9%
  • August 1 - 15: S&P gained about 0.2%

Conclusion: Since the first of July when Brinker began this new "direct correlation" scenario, Oil has dropped 20% and the S&P has gained a whoppin’ 14 points. (S&P on July 1st was 1284, it's now 1298) Graph courtesy of Kirk Lindstrom:

.

.

Brinker’s Saturday guest speaker was Charley Maxwell, the senior energy analyst at Weedon & Co. Brinker asked Maxwell about his previous oil price predictions in spite of the fact that Brinker is on record saying this on July 12, 2008: “Now I wish I could tell you what the price of oil is going to be in a week, a month, a year. I don’t know. I have no way of knowing and I think only a fool would try to forecast the price of a barrel of oil in the world we live in…….”

.
Charley Maxwell replied to Brinker:

.

“It’s on all of our minds, what happens next? In quick terms, I think that we are not solving the problem we have of less and less oil being produced in the world over the next five and ten years. And the fact of emerging countries like India and China and Russia and the Middle Eastern States surging ahead with their demand. Probably nothing will stop it because they also subsidize their demand making it extremely cheap for their people to avail themselves of the supplies so that demand is maintained higher than it should normally be.

.

And for these reasons we think that taking a long-term view, of the price of oil will stop here for a year and a half or so – maybe two years and then continue up. But for the next one and a half to two years, I think we get a breather and a wonderful breather. I’m looking for the price to come down temporarily to around $80 to $90, and perhaps to stay quite a while around $100 and that’s a good retreat from $147."

.


When Charley Maxwell appeared on Moneytalk last September, he predicted that oil should stay in a range of $50s up to $80 a barrel for another two years.

.

This graph is courtesy of Kirk Lindstrom:


Note of interest: For those who are unable to listen to Moneytalk when it is broadcast, KGO archives the program for FREE downloading for one week after the program airs. Simply go to KGO's website and click on "Archives" and listen, or download and listen at your convenience. http://www.kgoradio.com/
.
For a convenient way to have the option to record most all radio programs, I recommend the Replay Radio. I use it myself because KGO will almost always preempt Moneytalk in favor of football games. Sometimes they play the program later in the day, but no guarantee -- and it's a real nuisance trying to figure out the time they will play it after the game.
.

With Replay Radio, you can just program it to record Moneytalk and it will find a station where it is playing, record it and save it for you. It's not very expensive and in a few months would pay for itself -- especially if you are paying a monthly fee to download the program.
.

Record Moneytalk with your computer.

Replay AV automatically finds a station and records the show for you. No need to stay home tied to your computer. Listen live or listen at your leisure.

Download and Try it for free this weekend!


.




.

Tuesday, August 12, 2008

Bob Brinker's Fast-Moving Buying Opportunities

Bob Brinker's ever-lower, ever moving, all-new-money-in buying-opportunities over the past year:
.
October 3, 2007 (S&P@ 1526.75) Marketimer, Page Bob Brinker said
: “In August and September editions of Marketimer, we rated the stock market attractive for purchase on any weakness in the area of the S&P 500 Index mid-1400’s range. During August and September there were 18 buying opportunities, consisting of 15 market days on which the S&P 500 Index closed within the 1430 to 1470 range, and three market days on which the index closed slightly below that range. Although we do not believe further weakness into the mid-1400’s range must occur, we remain comfortable with rating the market attractive for purchase should any such additional weakness occur……….” (Honeybee EC: Brinker first issued the mid-1400's buy level in August 2007 = S&P 1455.)
.
April 19, 2008 Moneytalk Excerpts (S&P 1390.33) Bob Brinker said:
.
“You’ve heard me say on the broadcast, I think we are going to new all-time-historic-record stock market highs by 2009. I think by the time we get into 2009, we are going to be talking about all-time-historic record highs on the S&P 500 Index. But I know what you are talking about, I see it all the time.....in writings….in talking heads. They are talking down the United States of America. They are talking down our economy………(Caller: “Do you think people tend to focus too much on short-term?”) "Oh, absolutely, absolutely, I know this for a fact because when we have gone through this recent bottoming process, and certainly we have worked very, very hard to identify the bottom that I believe that we did accurately identify in the first quarter.
.
It’s my opinion that the March 10th low on the S&P 500 was the bottom for the correction. And I think that what happened was that was a very successful test of the initial low recorded January 22nd. You might remember the S&P 500 closed on January 22nd in a very high volume panic-atmosphere at 1310. Well we knew, that despite the fact there’d be some short-term rally.......back then, we knew there was going to have to be a successful test of that low. And we knew what was required of that test before it occurred. Now that is exactly is what happened. And the closing test in March was, actually it was less than 3% below the initial low established on January 22nd. So we are talking about a text-book testing process in that correction low that we looked at.
.
Unfortunately, unfortunately, and I’m sure you’ve heard this, there were a lot of people out there, and I mean a lot of people out there, who got it completely backwards off that correction low and that successful test……I’ve been telling people, going to, actually to February because we do this through the investment letter, of course, I’ve been telling people to actually use periods of weakness to buy into the market at specifically down in the low-1300’s or any minor weakness just below that level, which we got a little bit of there on March 10th and in mid-March, to take those opportunities to add to positions if you’re looking to add to positions – no mention, no thought of selling anything into this kind of weakness……”

.
Caller John concluded by saying: “I took your recommendation, Bob. When it was below the 1300’s I added…….I’m just glad I got you, your son and the Marketimer on demand.”
.
Brinker replied: "And just for the record, I’m right with John. I was doing the exact same thing that John was doing. When we saw that weakness on the correction test into the low-1300’s and that very, very minor weakness that we had just below that level for a very short window of time, I was doing the same thing that John was doing – which was adding to positions."

.
Now we know that Brinker issued a new (and lower) buy-signal in the August Marketimer. It's interesting to note that Kirk Lindstrom created this graph on August 1st, several days before Brinker published his newsletter. Notice that Kirk posed the question: "Do I hear "low-1200s?"
.
.
Some humor from SeaBiscuit which seems appropriate for Wednesday's stock market action.
.
After the "Brinker buying opportunities"

At 1400, 1300 and twelve hundred,

What next? Some "Brinker gift-horses"

At 1200, 1100 and nine hundred?!

Brinker Shave!
.
  • Dow closed down 109.51
  • S&P closed at: 1285.83
  • Oil closed at: 116.48.
My daughter took this picture on a recent vacation along the northern California coast -- Avenue of the Giants (redwoods):
.



Monday, August 11, 2008

Bob Brinker's "Bottoming Process"

As of the August 5th, 2008 issue of Marketimer, Bob Brinker still has not acknowledged the fact that the stock market dropped into bear market territory. And he has never mentioned the bear market on Moneytalk.

.
Bob Brinker views the market action since the first quarter as an "extended bottoming process" similar to what occurred in 1994. Brinker concludes that this "bottoming process" has extended over a period of seven months so far.

.
Brinker completely ignores the fact that he said on Moneytalk that the market had bottomed in March, 2008 and that he expected it to be on an "upward trend" from there. He simply moved on to a new market-timing scenario after the market continued down into bear territory in July -- AFTER he said it had bottomed.

.
In the latest Marketimer, Brinker's only explanation for having TOTALLY missed this bear market decline is that "stock market timing is a very difficult exercise" and that this "overall decline has exceeded our expectations."

.
As Brinker said on Moneytalk in July, he regards oil prices as the key to stock market prices now. Clearly, he has adopted an "if" or "only" scenario to his market predictions. IOW: His bullishness on the market only applies "if" oil prices decline and "if" interest rates stay low, even though he has made no changes to his 100% invested position for equity allocations.

.
In my opinion, if one happened to sink all "new money" into the market based on Brinker's August 2007 to January 20, 2008 "mid-1400's" all-in buy-level, one may not have had any "new money" to put in his February 2008 "low-1300's" buy-level, or his most recent and much lower buy-level.

.
Is that what's known as covering one's errr....bases or is it simply "make it up as you go"? 8~)




.

Sunday, August 10, 2008

Bob Brinker's Moneytalk Replacement

(Honeybee edit Tuesday, August 12, 2008:
.

I have to apologize to all readers. I simply have not been able to find time to listen to Bill Flanagan's Moneytalk programs this past weekend. At this point, it doesn't look too promising.
8^)


.
I was told that there was a caller in the second hour who made the statement: "I know you aren't supposed to try to time the market." I'd like to know what Flanagan's reply was and will report it here if it was interesting or informative.)
.

Bob Brinker is being replaced by Bill Flanagan this weekend.
.
I am tied up with family this weekend, and will post some comments later.
.
Feel free to express any opinions you may have about Flanagan or anything said on Moneytalk in the meantime (here).
.
___Honeybee

Friday, August 8, 2008

In Spite of Russian War, Stock Market Up; Oil Down Today

Bob Brinker is still making stock market predictions even though he is now on record saying that the price of oil is "directly correlated" to the stock market and only a "fool" believes he (the fool) can predict the price of Oil. Moneytalk, July 12, 2008, Bob Brinker said: "Now I wish I could tell you what the price of oil is going to be in a week, a month, a year. I don’t know. I have no way of knowing and I think only a fool would try to forecast the price of a barrel of oil in the world we live in…….”
.
Today the S&P closed at 1296.31 -- up 2.39%;
Oil closed at 115.09 -- down 4.1%
.

David Korn wrote:
".....Bob has now acknowledged
the inability to predict oil prices.
.
This is not something new for Bob. He has previously changed
his opinion on whether interest rates can be predicted (now
opting for the view that they can't), and he seems to have
given up on picking any new individual stocks.

.
The last refuge is the stock market in general. With his
position that you can't predict where oil prices are going,
given Bob's view that it the stock market is going to react
to oil prices, the logical conclusion is that you can't
predict where the stock market is going. But there was
no indication this weekend that Bob has given up on market
timing, or his model for that matter."
.
July 9, 2008, Mark Hulbert published an article in Barron's titled: Where Do Stocks Go From Here? Here is an excerpt from Hulbert's article:
.

"Bob Brinker's Marketimer: Bullish. In his most recent issue, which was published in early July, Editor Bob Brinker reported that his stock-market timing model remains in favorable territory. However, he cautioned that oil's price constitutes a "wild card." "In the event oil prices continue to rise, consumers and the stock market will be held hostage to the cost of energy. This would provide a strong headwind against the economic recovery process. If oil prices stabilize or decline from current levels, we believe stock prices can make progress into 2009." Brinker is recommending that subscribers' stock portfolios be fully invested."
.
.
Mark Hulbert quoted from the July 3, 2008 Marketimer. On that day, the S&P closed at 1262.90, and the price of Oil was $145.31.

.

However, all that being said, today, in spite of the bad news that war has broken out in Russia, the stock market closed up today -- way up, and Oil closed down. Based on today, one would be tempted to believe that Brinker is right -- that Oil truly is the stock market's "wildcard." 8~)
.
I predict that Brinker will talk about the stock market this weekend, but here's a bit of humor from SeaBiscuit:
.
"Talk about anything - baseball or football

Oil or gas or water or even just plain air

Anything to distract attention

From the big brown bear

Brinker Shave!"
.
.
I've only been to Oklahoma twice in my life, but find that it has a great beauty that is quite different from what I'm used to on the West Coast. This was taken looking out of a cousin's huge "barn" just before a terrifying
(to me) lightening storm hit. =80



Top Rated Newsletter


Timer Digest Features
Kirk Lindstrom's Investment Letter
on its Cover

Cick to read the full page article!