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Tuesday, September 30, 2008

Bob Brinker Has Had No Sell Signal Since 2000

Moneytalk September 27, 2008, Bob Brinker's stock market-timing advice:

Caller Ken from Times River, New Jersey said: "Hi Bob, it's certainly a pleasure speaking with you. I've been a subscriber and a faithful listener for at least 20 years, and I have only the utmost regard for your market timing philosophy, and I think you did a beautiful, beautiful job when the stock market collapsed when the dot-com bubble bursted in the early 2000, but I've seen some precipitous declines in the market since that time -- stocks going down 20-25%, and at no time have I heard you say anything other than become fully invested, and I wonder, did you miss the boat or am I mistaken?"

Bob Brinker said: "Mistaken about what, Ken?"

Ken replied: "About the fact that you still have everybody fully invested in the market after it has taken such precipitous losses. Do you think, is this still is the time to be invested? Is it the time to sell and get out of the market?"

Brinker said: "Actually Ken, it's not my opinion that you should be selling stocks right now. I don't have a recommendation to sell stock right now. And if I did have a recommendation to sell stock right now, you would know about it. No, I do not have that recommendation. And really, that's all I can say. We have not, we have not issued a sell signal on this market. And in fact, as things stand right now, I think that we are in a scenario right now -- this is just my opinion -- I think selling stocks here is a mistake. 1-800-xxx-xxxx. Linda in Thousand Oaks, you're on Moneytalk.

Kirk Lindstrom astutely pointed out:

"Read his answer very carefully. I think both you and David let Brinker slip one by...

He NEITHER confirmed or denied to the caller that he rode the bear down 30% while fully invested like he did in 1987.

He makes it sound like he is denying what Ken said with his answer "Brinker said: "Actually Ken, it's not my opinion that you should be selling stocks right now."

He left the door open that he could have had different advice when the market was at a top and that Ken has his facts confused.

An HONEST ANSWER would have been "Yes Ken, you are correct. You have not missed anything. We do not advise selling into weakness and our Marketimer Stock Market Timing Model remains bullish as it has been since March of 2003."

This is the same sort of nonsense non-answer to a DIFFERENT QUESTION that he used in the 1990s to make me think he called the 1987 bear market or at least stayed fully invested rather than going to cash in 1988 AFTER the market fell 30% in 1987 while he was fully invested.

He is a MASTER at wiggling out of a direct answer to a direct question that make him look anything less than perfect. He is even better at giving an answer that makes him look better than his actual advice, especially for new listeners.

September 30, 2008 10:06 AM

Hollyhock growing in my brother's garden in Idaho:

Note to readers. I'm hearing that some of you are having difficulty finding the comments section. If you want to read the comments from others or post some of your own, click on the little link (it's tiny) 8~) at the bottom of EACH of my posts. It looks like this: 1 comments)


Monday, September 29, 2008

Bob Brinker Sez Don't Sell Stocks

Bob Brinker's stock market recommendation as of two days ago was that it would be a "mistake" to sell stocks "right now." (See Summary below)

September 27, 2008, Brinker said: "I don't have a recommendation to sell stock right now. And if I did have a recommendation to sell stock right now, you would know about it."

Many would agree with that advice, but what a shame that Brinker did not recommend raising cash before the bear market began.

December 5, 2007 Marketimer (S&P 1481) Bob Brinker said:
“As is frequently the case, a number of stock market forecasters are claiming that the correction is the start of a bear market. We have heard the same claims during every correction since this bull market began in March of 2003. We continue to believe that a bear market (S&P Index decline in excess of 20%) is not on the radar screen at this time. We expect the bull market to continue at least well into 2008, and we look for significant stock market gains, including new S&P 500 record highs."


  • Dow declined 7% (10,365: lowest level since November 2005)

  • S&P 500 Index declined 8.79% (1106.42: biggest one-day point drop since 1987 -- lowest level since 2004)

  • Nasdaq declined 9.14% (1983.73: lowest level since 2006)

  • $Oil declined 10.12% ($96.07)

  • GLD rose 3.38% (89.57)

SeaBiscuit is always good for a smile, even on days like this:

"Stay invested!", he told 'em

"Down to your last cent" -

Even as the markets declined

By THIRTY per cent

Brinker Shave!


His portfolios blew up

It is very ghastly

Well, that's what you get

For kicking a grizzly

Brinker Shave!



Saturday, September 27, 2008

Summary: Bob Brinker's Moneytalk September 27, 2008

Summary, Commentary and Bob Brinker Excerpts

Ken's Saturday call to Moneytalk and Brinker's response.
David Korn explains it best in his commentary below -- don't miss it! Here's an excerpt:

"This was high drama on Moneytalk as it is the first caller that got through and asked Bob to comment on his stock market outlook in the wake of the declines. Frankly, I don't have much sympathy for Bob because he still hasn't even mentioned that we are in a bear market which is sort of ludicrous given that we heard ad nauseum about the bear market in 2000-2002 and the bull market (cyclical and secular) up until this market started declining. "

Honeybee here: Bob Brinker took a call from Ken Saturday. Ken used a bit of Brinker-ring-kissing in order to get the chance to point out that Brinker has had "everyone fully invested in the market after it has taken such a precipitous losses." Ken wanted to know if it might not be time to get out of the market.

Brinker avoided responding to the heart of Ken's question -- completely ignoring that his subscribers have ridden this bear market down fully invested. Instead, Brinker zeroed in on "RIGHT NOW" and repeatedly said he had no recommendation to sell stocks "right now."

Here is a transcript of the call that everyone is talking about:

Caller Ken from Times River, New Jersey said: "Hi Bob, it's certainly a pleasure speaking with you. I've been a subscriber and a faithful listener for at least 20 years, and I have only the utmost regard for your market timing philosophy. And I think you did a beautiful, beautiful job when the stock market collapsed when the dot-com bubble bursted in the early 2000.

But I've seen some precipitous declines in the market since that time -- stocks going down 20-25%, and at no time have I heard you say anything other than become fully invested. And I wonder, did you miss the boat, or am I mistaken?"

Bob Brinker said: "Mistaken about what, Ken?"

Ken replied: "About the fact that you still have everybody fully invested in the market after it has taken such precipitous losses. Do you think, is this still is the time to be invested? Is it the time to sell and get out of the market?"

Brinker said: "Actually Ken, it's not my opinion that you should be selling stocks right now. I don't have a recommendation to sell stock right now. And if I did have a recommendation to sell stock right now, you would know about it. No, I do not have that recommendation. And really, that's all I can say. We have not, we have not issued a sell signal on this market. And in fact, as things stand right now, I think that we are in a scenario right now -- this is just my opinion -- I think selling stocks here is a mistake. 1-800-xxx-xxxx. Linda in Thousand Oaks, you're on Moneytalk.

Honeybee EC: The last time Brinker sold equities after missing a bear market was in 1988 (he missed the 1987 Crash) and it was a huge mistake. The market turned up and he missed out on large gains for the next couple of years until he returned to 100% invested in late 1990.

All Brinker can do now is try to keep information like Ken revealed covered up so that any potential new newsletter subscribers will not be made aware of how he has made one blunder after another for the past year.

One of his most-used market-timing ploys is to issue new "attractive for purchase" buy-levels even though he is 100% invested. Moneytalk listeners have heard him brag about them. First he bragged about the mid-1400's buy signal. He did that with a caller back at the S&P's ATH. In essence, it served to embarrass the caller and shame him for not being Marketimer subscriber. Ka-ching!

Later, he bragged about the low-1300's buy-level after the market had briefly returned to 1400. He told a caller that he personally had been buying at the level. Again, this appeared to be designed to make listeners regret that they had "missed out" on Brinker's market-timing call. Ka-ching!

Now that the market has hit new lows in the mid-1100's, Brinker has thrown out ALL buy-levels and recommends only DCA. Has he mentioned this or any of the previous higher buy levels? Nope! Ka-ching!

This whole marketing-hook may appear silly, but it is quite effective. As was shown by Ken's call, it is not easy to get on the air and actually ask Brinker about the bear market, why he didn't raise cash and/or what does he recommend going forward. And you can bet your soup that if Ken hadn't talked long enough to get past the 7-second delay button, his questions would have been cut off at the pass. Ka-ching!

It would show great character if Brinker had taken the opportunity that Ken gave him to actually speak honestly and openly. Again, he chose to obtusely dissemble, distract and avoid.

Saturday, the remainder of the program was largely Brinker's opinions about what caused the financial crisis, what should be done about it, and the government bailout. Most of which, Brinker has talked about before. He expects an agreement to be reached by Sunday evening and then congress can move forward with legislation.

David Korn has generously offered to share his commentary with us:



Caller: This caller told Bob he has the utmost regard for Bob's market timing philosophy and thought he did a wonderful job during the dot-com meltdown in early 2000. However, he has seen some precipitous decline in the stock market over the last year, with stocks declining as much as 25% and at not time has he heard Bob say anything other than to remain fully invested. Have you missed the boat or is he mistaken? Bob paused. The microphone picked up the irritation in daBrink's breath as he leaned a little closer to the microphone and asked the caller exactly what he meant by "mistaken." The caller told Bob "mistaken" in that you have had everyone fully invested in the market even through this significant decline in stocks.

Another dramatic pause. A side glare at the call screener and then...

Bob said it is NOT his opinion that you should be selling stocks right now. Bob told the caller that if he did have a recommendation to sell stocks right now, you would know it. Bob said he has not issued a sell signal on this market. Bob concluded by saying that "as things stand right now" we are in a scenario such that if you sell stocks here that "would be a mistake."

EC: This was high drama on Moneytalk as it is the first caller that got through and asked Bob to comment on his stock market outlook in the wake of the declines. Frankly, I don't have much sympathy for Bob because he still hasn't even mentioned that we are in a bear market which is sort of ludicrous given that we heard ad nauseum about the bear market in 2000-2002 and the bull market (cyclical and secular) up until this market started declining. Moreover, Bob's stock market timing model really blew it this time. I mean let's put the cards on the table. The fact that he took a hard core approach to bashing the people who were bearish on the economy and stock market earlier this year, and the fact that he has not really been forthright or humble (if that is possible) has gotten under a lot of my subscriber's skins. I can't blame them.

EC#2: It bears noting that in the 22 years of Moneytalk, Bob has only issued a sell signal twice. Once following the crash of 1987 which turned out to be a very bad timing move and resulted in the subsequent modification of his timing model to include a sentiment indicator. The second time was based on the market's close on January 8, 2000, where he reduced his stock market allocation from a fully invested position, to 60% cash (later increased to 65% cash). I would certainly not expect him to issue a sell signal at this juncture. During 2000, he had recommended that subscribers use the 65% cash and invest a portion of it (anywhere fraaaaarom 20-50% of that cash reserves) into the Nasdaq-100 (QQQQ shares). At the time of the initial QQQQ recommendaion, the shares were trading at about $83. As the security declined, he recommended purchasing them at different levels. Today, 8 years later, the initial purchase remains down 50%. I bring that up because I get questions about whether I think Bob will issue any kind of sell signal and my response has always been that Bob's pattern is to ride a position down even if he is wrong and wait for it to recover. He is clearly banking on that happening with the market at this juncture.

EC#3: For those seeking reassurance from Bob, today's response is about the best you can ask for. The fact that Bob answered the question and said he would NOT sell stocks now, indicates that he believes you would be making a mistake by selling into the lows. Fortunately, I agree with him at this juncture as evidenced by my buy alert earlier this week which so far is in the black.

Complimentary issue of David Korn's Newsletter

Brinker's guest speaker on Saturday was Charles Guist, who wrote: Wall Street: A History: From Its Beginning to the Fall of Enron

Brinker's guest speaker on Sunday was John Zogby, who wrote: The Way We Will Be: The Zogby Report on the Transformation of the American Dream. (Note: John Zogby said that he is a "lifelong democrat" but hopes his polling work is objective.)


Bob Brinker Currently Recommends DCA

Bob Brinker's stock market bottoms in 2008:


Seabiscuit's Brinker-Shave

He screwed up huge

And suffered a big rout

So now he is demanding

That the Fed bail him out

Brinker Shave!


Friday, September 26, 2008

Bob Brinker is "Angry" Because No Fed Bailout Yet

Bob Brinker wrote an article titled, "I Am Angry" about the need for an immediate Fed bailout-- or so it appears.

I wasn't sure which Bob Brinker wrote the article, or even if he wrote the whole article because he gives no attribution other than "Bob Brinker."

So I took advantage of his invitation to post a comment on his website. I told him how much I enjoyed the article and that I wanted to cite it on my Blog. I asked him to clarify exactly who was the author since it isn't apparent from reading the article -- and I wanted to give proper attribution.

My comment to "Bob Brinker" was posted, but it only lasted a short while, then he deleted it without answering my question. This kind of rude censorship was standard-operating-procedure for the Brinker's now defunct message boards. If anyone asked questions the Brinker's didn't want to answer or if they didn't march to the Brinker "party line" they were rudely shut out -- much like Brinker does on Moneytalk via his call screener.

Here is what I posted on the younger Bob Brinker's website:
Hi Mr. Brinker,

I enjoyed your article: "I Am Angry." I would like to cite it at my Blog.

I see that you have added an "Editor's Note," which makes me wonder who wrote the article.

I want to be sure and use proper attribution. Did you write all of it?

(If I receive no answer to my question, I will attribute it to "Bob Brinker.")

Best Regards,

Why doesn't he want to answer my question? What are the Bob Brinker's hiding? Is the younger Bob Brinker signing his name exactly like the radio talk show host? Sure looks that way.

Of course, that's his name, but why wouldn't he want to clarify his identity somehow? It can't be that difficult -- most true "junior's" figure a way to do that. And I would think that since his father has radio-fame that he would be particularly careful not to be mistook for him. (Maybe he could use his middle initial which is different from the radio talk-show host's.)

In the article, Bob Brinker said: "I am angry. For the past year, our credit markets have been hanging on for dear life."

Brinker went on to explain that he doesn't like the bail-out plan, but he sees the need for immediate Fed action -- and that he's angry because it hasn't already been done so we can put all this behind us.

If Bob Brinker was aware that "our credit markets have been hanging on for dear life" for the past year, I wonder why he advised remaining 100% invested with equity allocations all this time.

Why did he then blame the market "situation" on the price of oil?

Why has he declared repeated market bottoms, just to have them taken out, too?

And most importantly, is he now going to use the "credit markets" to excuse the fact that his timing model was flashing for a roaring bull market in September, October, November, December 2007 and January 2008?

Perhaps he will have more to say about all this tomorrow on Moneytalk.

SeaBiscuit's Brinker-shave 8~)

He taunted the bear too much

Poking it and slapping its ear

Then the bear turned around and

Chewed up his derriere

Brinker Shave!


Thursday, September 25, 2008

Bob Brinker on Warren Buffet

Bob Brinker is a big fan of Warren Buffett's and has often sung his praises.

This is from my March 2, 2008 Summary:
Brinker completed his monologue by talking at length about Warren Buffet -- whom Brinker said is a “national treasure.” He said that Buffet had issued his annual letter and discussed some points with which he agreed. Firstly, that the housing market had been operating under the false premise that housing prices go up every year, which simply isn’t true. Buffet’s letter also said that some companies make excessively high return-rate assumptions on their pension investments. Buffet likened this to the queen in Alice in Wonderland, who said: “Why sometimes I’ve believed as many as six impossible things before breakfast.” Another point that Buffett made which Brinker agreed with is that the taxpayers will end up having to pay for those fat labor union pension plans. And when the money comes due, the politicians who agreed with the labor union's fat pension plans will be “on a beach with a mint julep.”

And speaking of "sages stepping in," I think Brinker will jump on Buffett's bandwagon for his big Goldman Sach's purchases like he did in on June 14, 2008:

Brinker said: “He (Buffet) has said today that the Federal Reserve was correct when it made the decision to step in on the Bear Stearn’s Company in Wall Street in the month of March. Of course, Bear Stearns the Wall Street Investment Bank – fifth largest at the time – that was looking at bankruptcy before agreeing to be acquired by J.P. Morgan Chase and Company in March, with the help of the Federal Reserve, led by the Chairman, Ben Bernanke. The Fed stepped in and provided a $29billion guarantee against Bear’s Assets. And J.P. Morgan, the third largest bank in the United States, agreed to pay $10 per share for Bear Stearns in the final deal……..

So there you have it, Warren Buffet’s opinion, quote, ‘I think the Fed did the right think in stepping in on Bear Stearns.’ Quote, ‘Just imagine the thousands of counter-parties around the world having to undo contracts.’ Mr. Buffet went on to say, quote, ‘The big investment banks………they’re almost too big to manage effectively from risk standpoint in the way they have elected to conduct their business. You need someone at the top whose DNA is very, very much programmed against risk,’ unquote.

And that’s an interesting comment from the Sage because we’ve commented on Moneytalk so many times about the fact that these Wall Street mucka-mucks, with the big paychecks and the fancy packages, the reality is they can’t manage risk in many cases and the firms end up writing off……literally tens of billions of dollars. And the only way your company writes of then of billions of dollars on failed investments is management incompetence, in my opinion. And I think that is exactly how Warren Buffet feels when he makes those comments. I could not agree with him more……..”

No doubt, if Brinker is on Moneytalk this weekend, he will have much to say about Buffett's $5billion investment in Golden Sachs.

There is an short, but interesting video commentary about Buffett's Goldman purchases at

This is a "snail plant" growing in oleander in my daughter's back yard


Wednesday, September 24, 2008

Bob Brinker's Marketimer Hulbert Rankings

Bob Brinker bullish on stock market since March 2003. That is a bit over 5 years ago. Brinker has bragged many times on Moneytalk about his March 2003 timing call, and he has made no changes in his asset allocation since then.

Brinker likes to pick a time-frame from Hulbert's Financial Digest and advertise with it. Let's pick the 5 year time period and take a look at how Marketimer ranks against other newsletters in HFD.

Hulbert's provides rankings for two categories.

In one Hulbert category, he ranks all the newsletters that he "follows." Of course, he does not follow all newsletters. He calls that category "The Top 5 Performers Through 8/31/2008."

Hulbert calls the other category, "Performance Scoreboard for Mutual Fund Letters."

Looking at the 5-year time period in each of those categories, Brinker's newsletter does not make it into the top-5 for either "risk-adjusted" or "not risk-adjusted."

And that is in spite of the fact that Hulbert gives Brinker a complete mulligan on the QQQQ trades (actually using model portfolio cash reserves two times).

Additionally, Hulbert lumps together Brinker's three portfolios and averages them, even though one of Brinker's portfolios is 50% bonds.

SeaBiscuit's latest: 8~)

He was forecasting new highs

And ever higher earnings

Even as the financial debacle

Was in its early innings

Brinker Shave!

He was so full of it

That he never saw it coming

The financial unraveling

And the day of reckoning

Brinker Shave!


Tuesday, September 23, 2008

Brinker's Advertised Performance Ranking Deception

Bob Brinker advertises his newsletter's "performance ranking" in Hulbert's Financial Digest on his website and often in Marketimer.

This is currently on Brinker's Marketimer website:

"Hulbert Financial Digest ranks Bob Brinker's Marketimer © number one for model portfolio performance for the ten-year period through August 31, 2008. Marketimer © earned a risk-adjusted compound annual rate of return of 10.6% for the ten-year period, versus a compound annual rate of return of 5.7% for the Wilshire 5000 Total Stock Market Index."

Here are the facts:

The Hulbert Financial Digest "risk-adjusted" category is not the "Total Return Ranking."

The "Risk-Adjusted Ranking" is one that Hulbert says, "Reports monthly performance per unit of risk, calculated using the Sharpe Ratio."

Brinker does not make it into any of HFD's top-5 slots for "Total Return Ranking" in the "Top 5 Performers Through 8/31/2008" category of all ("newsletters that HFD follows") over ANY time period -- 5, 10,15, 20, 25 years.

Brinker does not mention that Hulbert uses a footnote to explain why the disastrous QQQQ trade is not accounted for in his performance rankings.

So we have a circle of deception that Brinker is well aware of, but chooses to take advantage of anyway in advertising his newsletter, otherwise HE would mention Hulbert's footnote!

Even Hulbert's Brinker footnote is not accurate. Hulbert makes the statement that Brinker decided at the time of the QQQQ trade to keep it "off the books." That is not true -- Brinker did NOT announce that he would not take responsibility for the trade in his model portfolios until the month following the trade.)

Hulbert's Brinker footnote:

"PLEASE NOTE: In late 2000, Brinker forecasted a several-month bear market rally and recommended an investment in the NASDAQ 100-Index--a trade that turned out quite unprofitably. However, because Brinker, at the time of making this forecast, chose not to make this trade part of his model portfolios, his HFD record has not suffered as a result.”

Bob Brinker repeated the following instructions to subscribers in several issues of Marketimer.

November 6, 2000 Marketimer, Bob Brinker said:
"Marketimer subscribers with aggressive objectives can invest up to 30% to 50% of cash reserves in either the QQQ shares or Rydex OTC Fund in order to participate in this recommendations. That translates into potential exposure of 19.5% to 32.5% of a TOTAL AGGRESSIVE PORTFOLIO. (30% of 65% CASH RESERVES equals 19.5%. 50% of 65% cash reserves equals 32.4%). The balance of reserves remain in money market funds.

Conservative subscribers can invest up to 20% to 30% of cash reserves in this recommendation, using either QQQ shares or Rydex OTC Fund shares. That translates into potential exposure of 6.5% to 9.75% of a total BALANCE PORTFOLIO. (20% of 32.5% cash reserves equals 6.5%, 30% of 32.5% CASH RESERVES equals 9.75% of a BALANCED PORTFOLIO. The balance of reserves remain in money market funds."
Brinker's QQQQ-trade has never been closed and all follow-up guidance ended in March 2003.

Seabiscuit wrote a Brinker-Shave about Brinker's monologue last weekend: 8~)

He read it like a newsreader

Rambling on and on about the bailout

But not a word on the bear-market

What a total cop-out!

Brinker Shave


Sunday, September 21, 2008

Honeybee Comments on Bob Brinker's Moneytalk 9/21/08

Today, Bob Brinker used his program as a political soapbox. There was no stock market talk. (Brinker has not changed his stance on the market. He's fully invested. Although, he may have made a minor capitulation last week when he sent out a bulletin dropping his last buy signal.)

Warning, this is not going to be one of my usual objective Summaries. This is largely going to be my own opinion about today's program. However, unlike Brinker, I will allow other opinions to be expressed if anyone cares to send them.

First let me say that I have no problem with anyone having a political program and preaching their own viewpoints -- on either side of the aisle. I listen to political talk-show hosts all the time, but they are all up front about their agendas, and don't try to deceive listeners into thinking they don't have agendas.

I have a real problem with someone who claims to be a "professional" stock market timer/financial adviser but uses his "Moneytalk" program to promote his own politics while flying under the radar of so-called objectivity and "independence."

Today, it often sounded like Bob Brinker was on the edge of completely losing control of himself. He literally raved at and shouted down more than one caller because they gave opinions that Brinker did not agree with.

Brinker has a record of cruelly attacking powerful women which goes back many years -- as far back as the late 1990's when he demeaned Abby Joseph Cohen, Elaine Garzarelli and others. More recently, he repeatedly ridiculed Hillary Clinton, and used her name in such a way as to demean her.

A bit of history here: For several years, Bob Brinker used an alias on a message board to post "anonymously." Originally he used the pen-name "donlane," but years later, he changed that to "mistertopes" -- perhaps to confuse anyone doing a search for his posts.

For those who don't know, Elaine Garzarelli has a problem that causes her eye to involuntarily twitch. It must be very uncomfortable and embarrassing for her. Most people would feel sympathy. Here are two samples of what Brinker, writing as mistertopes, said:

From: mister topes Wednesday, Oct 29, 1997 10:33 PM

You have hit the nail on the head with your post. That is exactly
why Elaine is known worldwide as the Princess of Wink. She winks
at the camera as she gives her advice so as to tell the viewers
not to really pay any attention whatsoever to what she says
because she is completely clueless. She has proved that solidly
with her disastrous July 1996 Dow 5400 "sell everything" signal.
And she proved it again with her ridiculous October 24
advice that the market is in a range between 7000 and 8500.
Hey Elaine, I don't need you to tell me that. All I need to
is pick up any paper with a graph of the market and that is
what has already happened this year. Do you actually get paid
real money for making such inane and useless observations?

From: mister topes Friday, Oct 31, 1997 9:17 PM

It is said the secret code for the Princess of Wink is as follows:

If Her Winkness winks frequently she is telling you to totally
disregard everthing she is says because she is clueless.

If Her Winkness does not wink at all she is telling you to
take everything she says as seriously as her "sell everything"
signal at Dow 5400 in July 1996. Unfortunately for the
Princess of Wink, that marked the absolute bottom of the market
for 1996 making it the ultimate buypoint for smart investors,
but the ultimate stupid sellpoint for followers of the Her Winkness.
Elaine, you are truly amazing. Do you actually charge money for this?


Now back to today: Several times, Brinker hammered Sarah Palin insultingly and with half-truths. One time, after he was talking about her "inexperience," Brinker made himself sound like a complete "fool" when he said, "Let me tell you a problem that I have. I'm upset with the selection of the governor [Palin] because I, on Moneytalk, prior to the date of the selection, I recommended to John McCain right here on Moneytalk that he select Michael Bloomberg.........On day one, on day one, Michael Bloomberg could be president of the United States. It's a no-brainer. I gave the advice on Moneytalk prior to the convention. John McCain completely ignored it. So I'm not happy........."

So Bob, you are "unhappy" that the presidential candidate did not do as you demanded? With all "due" respect, what utter arrogance! McCain may listen to Rush Limbaugh, but I doubt he knows you exist. And after the way you keep twisting and repeating what he said about the economy, I doubt if he'd take your advice for anything. He would easily see what you're all about.

Brinker made a big deal about Sarah Palin and the Alaskan "Bridge to Nowhere." Well, it looks to me like Sarah Palin did have some involvement at the beginning, but after gathering all the facts, she CHANGED HER MIND and turned the money down.

What is so bad about that Bob Brinker? You have changed your mind about what is an "attractive for purchase" stock market buy level SIX TIMES THIS YEAR!

Here are the facts from USAtoday:

The Anchorage Daily News quoted her in October 2006 as saying she would continue state funding for the bridge. "The window is now, while our congressional delegation is in a strong position to assist," she said.

Asked why she supported the bridge, Palin's communications director Bill McAlister said, "It was never at the top of her priority list, and in fact the project isn't necessarily dead … there's still the potential for improved ferry service or even a bridge of a less costly design."

She changed her mind, he said, when "she saw that Alaska was being perceived as taking from the country and not giving, and that impression bothered her and she wants to change it. … I think that Sarah Palin is someone who has the courage to reevaluate situations as they developed."

In September 2007, Palin's office issued a new release saying the governor had "cancelled all state work on the Gravina Island bridge project, which gained national fame as a symbol of what critics said was wrong with federal budget earmarks."

"I think that's when the campaign for national office began," Ketchikan Mayor Bob Weinstein told the Anchorage Daily News on Saturday.

On Fox News Sunday, McCain touted Palin's opposition to the bridge.

"Yes, the pork barrel project, a $233 million bridge in Alaska to an island with 50 people on it," McCain said. "She, as governor, stood up and said, we don't need it, and if we need it, we'll pay for it ourselves. Now, that's guts. I saw that, and I said, this, this is what we need in Washington."

So Mr. Brinker, when are we going to hear your cute pejorative names for Barack Obama or Joe Biden? When are we going to hear about the things that Obama has "changed his mind" about? When are we going to hear about Obama's vast experience and his vast voting record and accomplishments?

After all, today I heard you say that you wouldn't want to sway anyone's vote.....What a "joker" you are, Bob.....


Saturday, September 20, 2008

Summary: Bob Brinker's Moneytalk September 20, 2008

Bob Brinker September 20th Moneytalk Excerpts and Honeybee's Summary and Commentary

Bob Brinker's opening monologue was an excellent review of what happened in the financial system last week. Here are some excerpts taken from the very long monologue.
Bob Brinker reminded listeners about that old Chinese Proverb, “May you live in interesting times,” and said he was thinking about that old bromide this week as the financial news and stories about the Wall Street situation were making headlines.

Bob Brinker said: "It was amazing.......And we certainly have been blessed by the investment gods to have the opportunity to talk directly with you on the weekend during all of this ongoing news breaking, quick developing times that we’ve seen.......Lehman Brothers went down the tube on Sunday night.......the company was run into the ground, in my opinion. In the last six months, once the Bear Stearns news broke, it should have been zero tolerance for bankruptcy at Lehman. They should have done everything in their power to find somebody to take them over, but they didn’t and they’re gone. As far as the stock market is concerned, it’s pennies a share – forget about it.

And then we had what I regard as a shotgun wedding.......We haven’t seen too many shotgun weddings on Wall street, but I think we saw one last Sunday night when Bank of America took over Merrill Lynch.......Merrill Lynch was getting extremely vulnerable.......And think the fact Bank of America came in there and took them over is probably a really good thing for Merrill Lynch.......Maybe it will work out long-term for Bank of America. I think they have a really impressive Chief Executive Officer at Bank of America, and it wouldn’t surprise me at all if he’s able to make that work.......

……..And then we had the saga…..of AIG Group, the giant insurance company. The situation there was one where counter-party risk was so great that the government really had no choice but to.......come up with a package. And the package is an interesting package – 80% equity stake in the company. They own 4/5ths of the company.......And a $85billion line of credit at a very high interest rate.......8 ½ points over Libor. Libor is roughly 3%........8 ½ and 3 is 11 ½ is the cost of the money – roughly.......not a day at the beach.......And it wasn’t surprising we heard AIG talking this week about trying to come up with a plan to get that loan paid as fast as possible.......that’s expensive money.......not to mention giving up 85% ownership.......It would not surprise me that the United State Government can come out of that with a profit someday.......

.......We had the markets jumping around, gyrating as rarely they have.......We had the situation where Sunday night – remember you heard me say this last Sunday on our broadcast, that government says no taxpayer money to bail out Lehman Brothers. And by the way, they never did bail out Lehman Brothers, they went down.......Well, that government policy lasted about 48 hours. It certainly did apply to Lehman Brothers, but about 48 later they had to do something with AIG. So by Tuesday night they the AIG rescue package together – the $85billion line of credit.......

.......So then we get to Wednesday – markets are jumping around and at this point, we get to a new phase. And I really think we have to look at it this way, as we progressed during the week – very valuable to take a look at what was going on at various time stations during the week. We get to Wednesday, and at this point, we’ve already had the news that one of the very first money market funds of all, this goes all the way back to the 1970s, the Reserve Fund, which is a money market fund of many stripes, including an institutional money market fund had broken the buck.......In other words, it wasn’t going to return a dollar – it was down to about 97 cents on the dollar. That’s a 3% principal loss to the money market fund shareholders.......

......That’s only the second time in history of money market investing that a fund has broken the buck. Now there have been times when the managing company has thrown money in to keep it at a buck, but this time it broke the buck.......In addition to that, after Reserve made this announcement, during the time there were rumors about the Reserve Fund, money was coming out of the Reserve Fund like water going down the drain. It was fast – tremendous amounts of money, billions and billions and billions going out of the fund.......

.......And that creates problem in the commercial paper market. It creates problem in the short-term financing arena. Commercial paper is a promissory unsecured note issued by a company for up to 270 days. It’s only backed by a promise to pay.......I remember in my early days working on the commercial paper desk at the Provident National Bank, and actually we issued commercial paper for the bank holding company, we also acted as an agency for other commercial paper. And you have to have confidence in the market to have a viable commercial paper market place – without that, you have nothing. So all of this is starting to feed into the commercial paper market.......

.......Now we get to Thursday and the situation deteriorates further.......Look at it as of Wednesday night: Bear Stearns is gone – went to J.P.Morgan in a takeover which should be described as a shotgun wedding in March.......Fannie, Freddie Mac is gone mostly to the government in a shotgun takeover a few weeks ago. Lehman’s gone Sunday night. Merrill Lynch taken over by Bank of America in what I regard as a de facto shotgun wedding last Sunday night. AIG taken over mostly by the government on Tuesday night in certainly a shotgun arrangement. All of these things are going on. And that gets us to Wednesday night, and we have these money fund rumors out there. This is a whole new chapter. Money Funds? Yeah.......

.......Then we get to Thursday, and the situation deteriorates further because Bank of New York Institutional Cash Reserve Fund, we find out, has investments in Lehman Brothers paper. Don’t ask me why any money market fund at this late date would have anything in their portfolio from Lehman Brothers. Lehman Brothers has been rumored to be the next to go after Bear Stearns since March. Lehman Brothers stock was bouncing around like a tennis ball last March when Bear Stearns went down. Money market funds invest for the short term. Typical average maturity is a few weeks.......It’s absolutely infuriating to me that any money fund manager would have Lehman paper when six months ago this company became the next to go…….in the rumor mill. And yet, despite all I just said and I’ve said this on Moneytalk just about every weekend for month after month.......that a money market manager should know how to run his or her fund without stepping in a black hole like this.

Anyway, we find out Thursday, just two day ago, that Bank of New York Mellon Institutional Cash Reserve is down about a penny a share in principal value because of holdings of Lehman……And then on Thursday, we get some more news coming out of Boston, Massachusetts – coming out of the Putnam Funds. Putnam Investments, one of the old names in the mutual fund business, they announce on Thursday, during the day, they are closing and liquidating their Putnam Prime Money Market Fund – this is a $12billion fund for professional investors………because there is a run on assets. People want their money. Well, in a money market fund, you are supposed to be able to get your money every day……Well, they had maturities, they didn’t have all the money in one day…….it was not a default issue, it was a liquidity issue…….

.......So on Thursday, we have something that we’ve never seen before. We don’t have a run on the banks because we have the FDIC. We have a run on the money market funds. And then Thursday afternoon, shortly after the Putnam announcement – no coincidence here – shortly after the Putnam announcement threatened to create a run on the $3 ½ Trillion money market industry, that we get word from Washington that a package is going to come in to hypothetically resolve the mortgage situation. And also provide insurance for money market funds. That’s a brand new item. And also, prohibit selling short financial stocks, at least until October 2nd. And you can take it to the bank; they are likely to extend that time line – probably until after the election.

And there you have it. And once it came from Washington they were going to put a package together, no matter what the cost, and that was part of it, then the markets were calmed. And by the way, at the end of the week, it’s almost comical when you consider the volatility, I mean truly, when you look at the volatility this week, what I am about to tell you is borderline comedy and yet it’s reality, it’s true. The S&P 500 for the week was up 3 ½ points…….It’s ridiculous when you look at the volatility…….The volatility in and of itself is just bizarre."

Brinker made no further stock market comments. A few of the callers mentioned that they had sold all their stocks (some even years back) but Brinker did not respond in any way. He certainly did not explain that he had not and was not recommending that any stocks be sold or that he has been fully invested since March, 2003 -- and throughout 2008.

Brinker is still claiming that inflation is not a problem. MOF: he is claiming just the opposite is more likely -- deflation. Brinker asked one caller if he thought people losing jobs and their homes sounded inflationary.

Brinker said there were three things that happened that created the situation in the financial markets, and it was definitely bipartisan:

1) Republican Senator Phil Gramm (turned bank lobbyist) promoted and led the bill to Repeal the Glass Stiegel Act in 1999

2) Democrat President Bill Clinton signed the bill to repeal the Glass Stiegel Act

3) In 2007, the repeal of the uptick rule for short sales.

Additionally, the worst lending practices ever in the last several years -- breakdown of the code of lending.
Brinker said the latest number for the cost of the bailout package is $800Billion, but "just round it out and make it an even $1Trillion"

Most of the calls today were simply more discussion of the subjects that Brinker presented in his opening monologue.

Brinker's guest speaker Saturday was A. Michael Lipper, who wrote: Money Wise: How to Create, Grow, and Preserve Your Wealth


Sunday morning: What Brinker did NOT say New York Post reports that a complete meltdown was 500 trades away on Thursday morning.


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