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Saturday, March 14, 2009

Summary: Bob Brinker's Moneytalk, March 14, 2009

Bob Brinker's Moneytalk: Excerpts, Summary and Commentary, March 14, 2009.

The Dow closed at 7223.98, up 9% for the week. The Nasdaq closed at 1431.50, up 10.6% for the week. The S&P 500 Index closed at 756.55, up 10.7% for the week. Oil finished the week at $45.80, very close to where it ended last week.

In Bob Brinker's opening monologue, he talked about the importance of higher education and how it relates to unemployment demographics. He called education "money well spent for yourself or for those you care about." Brinker gave the breakdown again for all the different education levels. The information is available at the Bureau of Labor Statistics (link). Brinker said that the "United States" needs to "get its act together" and do something about the high school drop out rate.

Brinker then moved on to the subject of the "OPEC oil blackmailers" who "manipulate the price of gasoline" and who "....must have a happy hour every day to laugh at America." Brinker said they are right to laugh at us because the United States is doing nothing about it......

.....Brinker said: "We have a president who tells us, while hiding the actual data and never mentioning the data, who tells us in a national address earlier this year that his policies will double alternatively fuel output within a few years. What he will not tell you, but I tell you, is it's going from 1% to 2% measuring both wind and solar. Those are the actual numbers. You've heard them from Charlie Maxwell, our guest on the program recently.....You've heard them from industry experts. The president refuses to tell you the numbers.....That's great for OPEC. We're not doing anything. They still have 98% of the pie to chew at in terms oil imports....We import over 60% of our oil. Because we're on the down slope of Hubbard's Peak, we are producing less...... [Honeybee EC: There are some people who do not believe or accept this theory as factual.]

......There are things that can be done......They're ignored by this White House. A serious effort -- not TILTING AT WINDMILLS. Natural gas in vehicles -- a major cord, IGNORED by the White House, FOOLISHLY, IGNORANTLY IGNORED. And the other of course, they don't even want to talk about --nuclear power -- that's too obvious a solution. So the other countries will do it as we twiddle our thumbs. But there can be no objection to using natural gas in vehicles -- there is no objection -- just IGNORANCE in Washington, that's what we have.....

.....ATT, they're not so ignorant. Kudos to ATT. Did you see the announcement? This week, they say they are going to spend $350million over the next five years. They're going to purchase 8000 Ford Motor Company vans and trucks and run them on compressed natural gas. No kudos for the White House on this. No kudos for congress. This was a corporate decision. They like to bash corporations in Washington. I haven't heard any salute to ATT for this from anybody in the White House, so we'll do it here. This is the largest commitment in history by a United States company to an alternative fuel vehicle......

.....Of course natural gas burns less in terms of carbon emissions than gasoline. But more important than that.....We are burning our own natural gas. We are not importing it from the royal family. We're not importing it from EL PRESIDENTE, Chavez, or other people that hate the United States of America -- we use our own....So congratulations to ATT.....Wouldn't it be wonderful if we had a president who could see the light on such an OBVIOUS POINT. Nope, he prefers to tilt at windmills, and he does it every day. This is Moneytalk........"

UPTICK RULES: Brinker said that it had "worked beautifully" for 60 years and he hopes that they re-instate it -- because removing it created a "shorting franchise" for bear raiders. He pointed out that the SEC Chair, Mary Shapiro, has announced that the rule may be reinstated in "the spring." Actually, she said April. Read about it here (link). Brinker said that Shapiro's comments last week no doubt had sent some short-sellers scrambling to cover.

MARK TO MARKET: Brinker said it does not affect stock prices. Here is a Reuter's article that discusses the subject (link).

STOCK MARKET: Mark from Virginia said he was reading Benjamin Graham's book, "The Intelligent Investor," where he talks about an 80-20 split. However, he was putting his money into the Vanguard Total Stock Market Fund because, "it's like the stock market is on sale."

Brinker first asked Mark his age, then answered: "I don't have any problem with that, whether it's 80-20 or whether it's 100 to zero at the age of 32. What you doing is dollar-cost-averaging money that's coming out of your paycheck, right? .......Now this is money that you are saving for you future. These are not operating funds.......I think that dollar-cost-averaging is a good way to take money out of your put that money to work in the Total Stock Market Index.....I cannot contradict you for that. I think that is a fine policy.....

.....Now let's face it, people that have done that over the last dozen years or so, they've been jerked around pretty good because there's been a lot of credibility that has been lost in Wall Street in the past year. Wall Street, they did it to themselves and they did a heck of a job of it. They have damaged the credibility of investing in corporate America through the shenanigans of the past year -- including the bad loans that they securitized and packaged and resold and sliced and diced. And so, let's be honest about, Wall Street has done a great job of damaging the credibility of stock market investing......

.....People are looking at stock market levels that were the same as they were in 1997. If you want to damage the credibility of an investment vehicle, that's a pretty good way to do it. And that's what they have done. Now does that mean that the stock market cannot be a decent investment vehicle going forward? No, it doesn't mean that at all. What it means is that for the past 12 years, as a result of what's gone on in Wall Street, there's been -- and I would say to some degree, what's gone on in Washington, and especially with reference to fiscal irresponsibility which helped put us in the position we are in right now -- I would say that they have done a lot of damage to the whole concept of investing in equities. Not an implication for the future of the equity market, but an accurate historical comment on the last dozen years, without question. 1-800-xxx-xxxx."

[Honeybee EC: Here is what Brinker was saying on Moneytalk less than a year ago, April 19, 2008]:

STOCK MARKET CORRECTION: Brinker said: “....Stock market sitting in at 1390 on the S&P 500 Index. Now the all-time high recorded last October at 1565 prior to the correction, and we’ve had the correction. In my opinion, it came and it went and it’s in the history books. And right now, we are in a position where investors are looking ahead. I think they are looking ahead to an economic recovery down the line and that’s why we’ve seen the market improving.”

BEAR MARKET…..Brinker said: “Those who are out there with the bear stories now are making fools of themselves because it just doesn’t compute does it? ...that America is spiraling downward – doesn’t make any sense.”

MONEY MARKET FUND GOVERNMENT GUARANTEE: A caller asked Brinker about the possible upcoming expiration of the government guarantee on money market funds which is due to happen on April 30, 2009. Brinker said that unless Washington wants to take a chance on having another run on them, they should extend the deadline.

[Honeybee EC: There may possibly be an extension to September 18, 2009, but no decision has been made.] Here is more information about it (LINK)

PRESIDENT'S ECONOMIC EXPERIENCE: Brinker made the comment that, "Obviously, Barack Obama does not have a grounding in economics." [Honeybee EC: How interesting that Brinker never noticed that until AFTER the election. He pounded John McCain repeatedly last year for saying that economics was not his strong point.]

There were no calls about the stock market, most of the callers stayed on the subjects that Brinker introduced in his opening monologues and items in the news, such as what's happened with the banks (Brinker has covered that subject many times before), Bernard Madoff, energy, and some politics thrown in.

Today, Brinker told a caller that his Moneytalk program now has the highest rating it has had in 23 years and that his Moneytalk on Demand service which charges to download his radio program is a "breakaway" success. [Honeybee EC: Kudos Mr. Brinker, for being great at what you do.]

Brinker Saturday guest-speaker was Thomas Sowell, who wrote: "Applied Economics: A Common Sense Guide to the Economy"

[Honeybee EC: Thomas Sowell is a brilliant man who regularly has columns and articles published. He was calmly patient and logical in the face of Brinker's obvious (snide?) disapproval of many of his viewpoints. Brinker's best efforts to subtly belittle some of the things his guest was saying were always met with a friendly reply. I found myself feeling embarrassed for Mr. Brinker. If you missed the interview, I really recommend that you go to the KGO link below and listen or download it. It is in the 3-4pm time slot.]

No need to pay to have downloaded copies of Bob Brinker's Moneytalk programs. They are archived for FREE downloading at KGO810 radio
for a full 7 days after broadcast! [Saturday/Sunday 1-4pm] Moneytalk: Download it for FREE at KGO810 (link)

Bluce sent this picture of his 1951 Feruson TO-20. Unlike the Starship Shuttle, it's not for sale. Maybe because it has a great seat and steering wheel, or maybe because it belongs to Mrs. NOONE.... 8~)


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