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Thursday, November 26, 2009

Bob Brinker's Moneytalk: Sunday Update, Discussion and Excerpts, November 22, 2009

November 26, 2009......Bob Brinker's Sunday Moneytalk program had a couple of interesting conversations in the first hour. Because of this being a holiday week, I'm a bit slow getting it posted.

Shirley in Albuquerque asked Brinker what he knew about Barclay's Global Investors.

Brinker replied that he didn't follow that particular investment, but that he could tell her that Barclays is a company that has a good reputation around the world.

Brinker added:
"As far as saving on fees, I'm all for it. I don't know anybody that has spoken out more frequently than I have -- for over 24 years about the importance of reducing your investment expenses to a minimal accepted level. And that's why we have talked on Moneytalk about including index funds in your investment portfolio. We do it in our investment letter portfolio, Model I, which is aggressive; Model II, which is long-term growth; Model III, which is a balanced portfolio. All of those portfolios have weightings within the index community. We use the Total Stock Market, for example as investment that we like in terms of the model portfolios, which is an indexed investment. And that gives you very low expenses, broad diversification within that one holding. It gives you a high level of tax efficiency if you are investing within a taxable account........"

Honeybee EC: Yes indeed, Brinker certainly does recommend the Vanguard Total Stock Market Fund [VTSMX] for 50% of Model Portfolios I and II, and 32.5% of the balanced Portfolio III.

Brinker allowed a moneytalk caller to reveal 40% of the bond portion of Portfolio III, which is 20% Vanguard GNMA Fund [VFIIX] and 20% Short-term Investment Grade Fund [VFSTX]. The other 10% of the fixed income portion is in Vanguard Inflation Protected Securities [VIPSX]. The vast majority of the equity holdings in this portfolio is Vanguard Total Stock Market Fund [VTSMX]. You may read the transcript of this call and Brinker's reply in my October 17th summary [LINK]

Here are the dollar values of Brinker's three Marketimer Model Portfolios which clearly show that even after a 65% stock market rise since March, they are still worth a lot less than they were three years ago. (And these figures in no way account for any money used for the "off-the-books" QQQQ-trade that is still down over 50% after nine years of holding -- Brinker's last advice on them. He never closed the trade.)

January 1, 2007:

Port I value = $260,032
Port II value = $210,074
Port III value = $ 197,794

October 31, 2009:

Port I value = 212,009
Port II value = 177,751
Port III value = 188,950

Brinker continued talking to Shirley
: "If you're not a Moneytalk listener, how would you know, HOW WOULD YOU KNOW about the importance of holding down your investment expenses. How would you know about the way to hold down your expenses. [Honey EC: Oh for crying out loud --do you ever listen to yourself, Mr. Brinker? ROFLOL!] Now you're a Moneytalk listener, if you are listening you are by definition, you know that you go for low expenses in your portfolio......

......Well if you don't know that what happens? Well then there you go, you are shark bait, shark bait by definition. Somebody calls you up and says hey, buy this fund. They have a 5 or 6% sales charge, what do you know? You put in $10,000, you wind up with $9400 invested and the rest in gone, good-bye, into the commission account. Doesn't help you any and this happens to people all the time......

......I mean it's sad to say if you're not listening to the Moneytalk broadcast, you are by definition, shark bait......We talk about it all the time, indexing, no-load funds, dealing with companies that hold down your expenses......Because all that money you save goes in your pocket. And that is what Moneytalk is all about, getting the money to wind up in YOUR pocket."

Honeybee EC: Wonder if it's SHARK BAIT to pay for an "investment letter" that when followed as written, loses 50% in one year, as Brinker's Marketimer Model Portfolio I did in 2008?

Brinker's Sunday guest- speaker was David DeLong. He talked about the job market. The Saturday guest was Peter Clarke, who talked about Keynesian economics. Both weekend programs will be available on KGO until Saturday, November 28th at 1pm Pacific Time. The guests are in the 3-4pm hour. To download the programs, just choose the day, then right click on the hour that you want and use "Save Link as." KGO Moneytalk Archives [Link]

Dixiegeezer took this wild parakeet full wingspan. Click pictures to enlarge:

Dixiegeezer says these are wild Black-Hooded Parakeets. He sent this for us this morning:


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