Bob Brinker's comments summarized, paraphrased or excerpted:
STOCK MARKET....Has been doing very, very well. Year-to-date returns on the S&P 500 is 6.4% including dividends..... which is less than 1% from the 1343 closing high for the year. Last year returns were 15%.....2009 returns were 26%....
Honey EC: In March of 2009, the S&P 500 Index finally hit bottom in the worst bear market since 1929. It dropped 57% down to a low of 677. During the decline, Bob Brinker never recommended selling any stocks to raise cash. Brinker's Marketimer model portfolio-I lost over 50% in the 2008-2009 megabear. Based on numbers reported in the Marketimer, portfolio-I went from the Oct 2007 all-time-high value of $302,561 down to the February 2009 low of $143,938.
TREASURIES.... At rock bottom....you won't see rates like these very often in your lifetime.
ECONOMIC RECOVERY....Is happening without the help of the real estate market...The rate of recovery is modest....The 4th quarter annualized rate of real Gross Domestic Product was up at a rate of 3.1%....
S&P CASE-SHILLER REAL ESTATE 4-YEAR DECLINES....Atlanta - 25 1/2%; Boston - 9 1/2%; North Carolina - 14%; Chicago - 31%; Dallas, Texas - 7%; Denver, Colorado - 9.7%; Las Vegas - 57%; LA - 37%; Phoenix - 54%; Portland, Oregon - 24 1/2%; San Francisco - 37%; Seattle - 26 1/2%; Tampa - 44%; Washington DC - 23%.
JOBS REPORT.....For March, released last Friday...Payrolls up net 216,000 after subtracting losses of government jobs at the municipal and state levels.
UNEMPLOYMENT and UNDER-EMPLOYMENT RATES......Unemployment rate now at 8.8%, the lowest it's been in a long time. Under-employment still in the 15% range -- a big number and an important number.
DEMOGRAPHICS OF UNEMPLOYMENT (according to Bureau of Labor Statistics): White - 7.9%; Black - 15.5%; Hispanic - 11.3%; Asian - 7.1%; Bachelors degree or higher - 4.4% (half the national rate); Attended some college - 7.4%; High school - 9.5%; Less than high school diploma - 13.7%.
OBAMA ADMINISTRATION'S JOBS HOPE: Brinker opined that the Obama administration must be very pleased with what Brinker called a "very, very good jobs growth" in March, because if Obama hopes to be re-elected, he will need to have lower unemployment numbers.
Brinker said: "All of their re-election hopes have been pinned on their economic policies, starting with their stimulus package......certainly was not a perfect package, but it pushed a lot of money out there......And then the huge decision that the administration made to endorse the 2% reduction this year in the payroll tax, and that money flows right into the economy. Now they're getting the new jobs. We've averaged 188,000 new jobs for the first 3 months of 2011. So if they continue to see new jobs growth, they're going to be in a much better position in the event that they seek re-election. And everybody right now is assuming that they will seek a second term in the White House......8.8% is way, way too high for the unemployment rate, but hey! a couple of years ago, it was over 10%, so it's moving in the right direction."Honey EC: Firstly, Bob, who is "they" that you are referring to in the White House? Is it Barack Obama and Joe Biden? Or is it Barack Obama and BO? :)
BTW, you say that unemployment was "over 10% a couple of years ago." Are you sure about that? Two years ago, was March, 2009. Did it grow that much? The highest rate ever under President George W. Bush was 7.6% in December of 2007 -- his last month in office.
VANGUARD GINNIE MAE FUND (VFIIX): Brinker said: "That Vanguard Ginnie Mae Fund, wow, that fund has had an outstanding performance. I was just checking and added back the 27-cent distribution that was paid out for 2010......Adjusting for that distribution.....along with the current price of 10.73, that fund would be $11.00 per share adjusted for the distributions. And it's just been an outstanding fund in terms of the way it's held its value and at the same time throwing above average interest."
CALLERS
SAVING FOR YOUNG SPROUT'S EDUCATION.....Caller Joy from Illinois asked Brinker what she should chose to invest in for her three grandchildren, instead of "buying them toys." -- I-Bonds, bank account or stock? Brinker said that he hoped she would still buy them some toys -- that he didn't want to see the young sprouts grow up without toys because all of the money was in mutual funds. (Honey EC: Very funny, Bob. Big boys need toys too. LOL) He recommended that she look into the Coverdell Education Savings Accounts, Uniform Gift to Minors or the 529 Plans.
After finding out that Joy's grandchildren were all under 5 years old, Brinker replied: "You have a lot of time.....So I would choose the total stock market index . I'll give you a couple of examples. The Vanguard Total Stock Market Index. The Fidelity Spartan Total Stock Market Index. Or you can buy an Exchange Traded Fund, which trades like a common stock, ticker symbol, VTI......And this will follow the Wilshire 5000, so your return should duplicate the return of the total market.....You can dollar-cost-average...."
BRINKER'S COMEDY ACT FOR THE DAY....Ed from Marin, California wanted to know a safe place to park $50,000 while he waited to buy a house. Brinker recommended fully insured CD's, then when he found out that Ed was going to wait ten years to buy his house, he changed his mind and told Ed that he might want to use a balanced portfolio -- even though it would be possible to lose money in the stock portion.
Brinker said: "You may not want to do this. You could lose money, (dog barks in background) See that? Fido agrees! Fido is listening to Moneytalk and he's right on the money!......Boy, I'll tell you, these canines that listen to the program, they are so incredibly sharp. I mean, they are right on it!"GERMANY BUYING NYSE? Caller Michael in Carmel wanted to know about Germany buying the New York Stock Exchange -- would the United States lose any sovereignty. Brinker told him this had nothing to do with the sovereignty of the United States -- that malarkey was being spread by the fear-mongers.
DOLLAR COST AVERAGE AND SIDEWAYS MOVES... Caller Donna from Des Moines (Brinker called her "Donna, the Prima Donna) wanted to know about dollar-cost-averaging.
Brinker said: "When we talk about dollar-cost-averaging at this level which is very close to it's recovery high and it's high for the year.....When we dollar-cost-averaging, that's new money....being introduced into the market. When we are talking about money that's in the market now being moved over to another fund, from one stock investment to another stock investment, we regard that as a sideways move.....and that would not require a dollar-cost-average approach......"
MARKETIMER PORTFOLIO III: Brinker continued talking to "the Prima Donna": "However, if we are talking about new money being introduced into the marketplace, I would regard that as dollar-cost-average money given the tremendous rally that we have seen in this market since we upgraded the market to attractive-for-purchase in early July of 2010. After all, at that time, the S&P 500 was around the 1030 level, and now here we are less than a year later, looking at the 1330 level.....
Honey EC: Good Job, Bob. Oops...I'm rhyming just like you did with Linda-Belinda when you said you sounded like Jesse Jackson. No seriously, after only FIVE prior "upgrades to attractive for purchase" during the bear market, you finally got one right.
And did you forget how you gave up altogether on making buy-signals in March 2009 (the very month the market bottomed) when you said you would begin looking for that elusive bottom? Those bottoms can be real hard to find sometimes, even for famous market-timers. :)
Brinker continued answering "Prima Donna"...... "As far as putting the money into model portfolio III of the investment letter which is on page 8, that is a balanced portfolio, which incorporates both stocks and income investments. If you want to make it an all Vanguard portfolio, I would just substitute the total stock market index for any funds in that portfolio that are not Vanguard domestic funds and I would substitute Vanguard International for the one fund in that portfolio that is a non-Vanguard International portfolio."
Caller Linda from Redwood city (Brinker called her Linda-Belinda) said she was in "sticker shock." She needed to raise $10,000 to pay her taxes this year because she had to take her first Required Minimum Distribution. She said her "social security piled up," still working, and now is in the 25% Federal bracket. She feels she can't retire and she's "scared to death." She also mentioned her Roth and having money in Wellington Fund. Brinker suggested that she invest in some investment grade, tax-exempt AA munis. He told her to disregard insurance ratings and only look at the underlying rating from firms like Moodys and Standard and Poors.
Brinker told "Linda-Belinda": "If you have double-A or better, I think you have a quality security, and then if you hold that security to maturity.....ah...I'm starting to sound like the Reverend Jesse Jackson and I didn't even try....if you hold that security to maturity, then what happens is, you should be able to get your money back if it's dollar good and the income is double tax-exempt."
SHARK BAIT.....Caller Diane said she had a half-million dollars that she didn't need that had been invested with Schwab in a "diverse portfolio" that since July, 2010 had gained 11.2% after fees. She asked if it would be simpler and less costly if she followed one of Brinker's portfolios or should she just diversify with total stock or bond funds. She asked if it was a "bad time to liquidate and leave Schwab" in order to make these changes.
Honey EC: Brinker's answer to Diane was just a snake oil pitch for his newsletter. It was a shameless attempt to take a bite out of Diane. I won't dignify his smooooth malarkey by repeating it. Diane, if by some miracle you read this, here are the answers to your questions:
Firstly, if you are paying someone to manage your half-million at Schwab and you have made 11.2% in a diversified portfolio since last July, you have done reasonably well.
Second, you do not have to leave Schwab if you want to buy total stock or bond funds. They are available at Schwab, the same as they are available at Vanguard -- some at even lower cost. But if you still want Vanguard Funds, you can purchase them through Schwab for a commission -- which if you hold for the long term is quite small -- certainly less than you would pay to subscribe to Marketimer. You can make at least 4 or 5 Vanguard purchases at Schwab for the price of one year of Marketimer.
MYSTERY OIL STOCK VERY PROFITABLE....Al from San Francisco, wanted to know if he should withdraw some needed cash from his money market fund or from the one oil stock where he has over half of his million-dollar net-worth invested....Brinker said that Al had fortunately done okay with his oil stock over the recent past, but that he would recommend taking money out of the oil stock rather than the money market fund.
Honey EC: LOL! I have a hunch Al did extremely well with his oil stock, but Brinker sounded very "displeased" with Al having so much money in one stock. Twice, he sarcastically pointed out that Al wouldn't be interested, but he recommended a maximum of 4% in any one stock.
HOW THE RICH AVOID TAXES ALTOGETHER....Caller Leonard from Tucson told Brinker that he went through withdrawal symptoms when they stopped broadcasting Moneytalk on Saturdays. He said that he sold his business which put him into the Land of Critical Mass. Then Leonard spelled out in detail how he set up an LLC and sheltered most of his income and actually got money back from the government instead of paying any taxes on the sale.
Brinker said: "What we are going to do is classify you at the head of the class at maximizing the tax code to your advantage...in terms of exploiting the legal way to reduce a tax bill."
Moneytalk on demand audio/podcasting is available for FREE at KGO810 radio for up to seven days after broadcast. The program is archived in the 1-4pm time-slots. You can take it with you! I download and save all three hours, including the third hour guest-speaker, so that I can refer back to them in the future if Bob Brinker mentions something about them on the air. KGO Radio MP3 Sunday Archives
Brinker's guest-speaker was Barbara Weltman:
Dixiegeezer went from this Croc in Costa Rica (click to enlarge):
To this in Clearwater, Florida:
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59 comments:
And then the huge decision that the administration made to endorse the 2% reduction this year in the payroll tax, and that money flows right into the economy.....
.....Now they're getting the new jobs. We've averaged 188,000 new jobs for the first 3 months of 2011.
Do you know if brinker tied these two statements together, and how? It's hard for me to believe than anyone could be so ignorant of the tax.
The payroll tax ONLY decreased on the employee end, NOT THE EMPLOYER end.
This could NOT cause any increase in jobs, since employers were not saving anything. The jobs increase had to be attributed to increased spending only by the consumer......and that is a GIANT LEAP OF FAITH.
The new tax cut in Social Security has changed to 4.2% for workers but remains unchanged for the employer's matched percentage. For an example, a worker who earns $50,000.00 in total accumulated wages would have had to pay $3,100.00 towards taxed income into Social Security. This has changed to $2,100.00 in taxable income towards Social Security, giving that worker an extra $1,000.00 more in take home pay and Social Security $1,000.00 less than previously accumulated amounts taxed.
This Social Security IRS payroll tax decrease will create a major impact towards jobs and growth; it will create more jobs and boost the regression state that the economy has been suffering from. Much needed boosts towards the economy will decrease the overall major deficiency that the United States has fallen into over the past decade or two. Although this IRS payroll tax cut into Social Security will not help the Social Security financial woes, the $120 billion lost to Social Security's trust fund from the payroll tax will be replaced with the general tax revenue, creating an overall impact of no change towards the already financially deficient Social Security.
http://www.limonwhitaker.com/our-blog/bid/53484/IRS-Payroll-Tax-and-Social-Security-Cuts
Good morning Mr Pig,
Yes, Bob Brinker tied those two statements together with zero pause or any words.
I separated them because I thought it made it easier to read. However, I can see that it can be confusing, so I will definitely re-connect them for clarity.
Thank you for pointing that out to me.
You are absolutely correct! The payroll tax did NOT decrease for employers, so why would one assume that it has anything to do with more hiring!
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Blago,
You, like Mr Pig, are correct that the payroll tax reduction did not change for employers.
So please explain to us why you think that will create a "major impact" on jobs.
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"This Social Security IRS payroll tax decrease will create a major impact towards jobs and growth; it will create more jobs and boost the regression state that the economy has been suffering from.
Tell me this BLAGO-BOY........ HOW? How will it be a MAJOR impact on job creation and growth?
All you did was copy an opinion from some obscure site.
PROOF PLEASE, for your assertion.
Goodbye........
Blago,
Another thing: Why is it a good thing to damage the already floundering Social Security Ponzi Scheme by another 120 Billion dollars?
As you posted, the Government will just have to take more from the general fund, since they have already robbed the Social Security "Trust Fund."
Therefore, everyone gets to pick up the tab, whether or not they benefited from this selective tax cut.
.
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Gallup has different job statistics than the government. Who you gonna believe?
March 31, 2011
Gallup Finds U.S. Unemployment Rate at 10.0% in March
Underemployment falls to 19.3% from 19.9% at the end of February
by Dennis Jacobe, Chief Economist
PRINCETON, NJ -- Unemployment, as measured by Gallup without seasonal adjustment, was 10.0% in March -- down from 10.2% in mid-March and 10.3% at the end of February, but above the 9.8% at the end of January. U.S. unemployment was 10.4% at the end of March a year ago.
Read more and see graphs:
Gallup Finds Unemployment Rate at 10% in March
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Critics have been spreading misinformation that the payroll tax cut will threaten the solvency of Social Security. That's just plain wrong. The legislation creating the tax cut requires that any money the payroll tax would have provided to Social Security be replaced by other U.S. general revenue funds, protecting Social Security without an additional burden on taxpayers. The Social Security Trust Fund's chief actuary as well as the executive vice president of the AARP have both spoken out, saying that the payroll tax cut will have no financial impact on Social Security.
Creating jobs
This payroll tax cut — which is showing up in workers' first paychecks this month — represents just the kind of sound economic policy this administration has pursued from the get-go. Money will immediately get into the hands of those who need it most — middle class families — and economic history has time and again shown that they will go out and spend it, spurring demand and creating jobs. Combined with the other elements of the tax package signed by the president, the plan is estimated to create more than 1.5 million jobs, with some analysts predicting even more.
http://www.usatoday.com/news/opinion/forum/2011-01-12-column12_ST2_N.htm
Blago,
I published your last note, but until you engage in dialogue of your own rather than just copy and paste stuff, I won't publish any more.
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With regard to the reduction of the SS tax, i.e., more $ in the employees' pockets, I think BB was saying this money is getting spent and that promotes hiring.
The way he put it, he made it sound like there was a direct connection. (Mr. Pigs criticism). The connection between this saving and hiring is much more indirect because it depends on how the money is being used.
Some weird calls yesterday.
-- Frankj
"With regard to the reduction of the SS tax, i.e., more $ in the employees' pockets, I think BB was saying this money is getting spent and that promotes hiring."
Of course that's what Brinker was saying frank.
Pig himeself, takes a GIANT LEAP in an effort to discredit Brinker wherever he can.
It's a pity that he has to resort to nitpicking word parsing to make a post.
FrankJ said: "I think BB was saying this money is getting spent and that promotes hiring."
Okay, I see that point when it is presented as an indirect consequence of SOME people having more money in their pockets, spending more, thus creating the need for more hiring.
But if that is true, just imagine how much more hiring would happen if the economy was stimulated even more with some across-the-board tax cuts for everyone.
I guess Milton Friedman was right after all. :)
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Hey, I have been personally attacked (twice)in a dopey post that makes no sense by a sissy freak bending over to support brinker.
Please leave it so the crybaby BLAHgo Boy can see how brinker does NOT need me to discredit him.
All brinker has to do is open his big mouth, and we keep the records of it, and the screwups do NOT disappear.
Ain't the internet GRAND, BLAHgo boy.
(((ROAR)))
Your proof is an opinion piece by Joe Biden from January 11th?
That's kinda dopey, even for you, when I aksed (sic) for proof, BLAH BLAH BLAHgo.
Wanna try again, or will you give up and slink away qqquietly?
Assuming Blago's claim is accurate ($1000 extra take home pay for a $50K earner) where will this eighty dollar monthly windfall most likely be spent?
At the gas station for higher fuel prices.
In the grocery cart for higher food prices.
Not much left over for a "major impact" towards growth and jobs.
On the SS matter I cringe whenever I hear a career politician claim how Social Security must be preserved while for decades the annual surplus from the trust fund has been spent by Congress.
How have they done this? By counting on the ignorance, or indifference of their voters.
As a matter of fact, I agree with what Mr. Pig said about there being a leap of faith to believe that the extra 2% led directly to the increase in employment.
Why? Because as I said previously, it depends on whether people sock it away, or spend it. If it is spent, it depends on what. If they use it to reduce credit card or mortgage debt, then I don't see that as direct job creation.
-- Frankj
No happy talk from Brinker on how safe nuclear energy is this week?
Joey
I thought Leonard in Tucson was great. He reached critical mass when he sold his business. Now he does consulting. He made good money last year and through his great knowledge of the tax code he paid no federal income tax and wound up getting $6,000 back. It made me wonder if he was a tax consultant for GE. America what a country.
Jeff:
Yeah, then there was the guy who called in when the guest was on. He got 80 weeks severance pay (which is taxed at 25%, like a bonus) and he started his pension (61 yrs old). He said he got whacked this year on taxes.
She (the guest) had no advice to offer him, he just has to suck it up and pay.
Flat tax. Everybody into the pool.
-- Frankj
birdbrain said...
"Assuming Blago's claim is accurate ($1000 extra take home pay for a $50K earner) where will this eighty dollar monthly windfall most likely be spent?
At the gas station for higher fuel prices.
In the grocery cart for higher food prices.
Not much left over for a "major impact" towards growth and jobs."
Yes but isn't it also a TAX CUT FOR THE RICH. Don't CEO's also qualify. Take Jeff Immelt the CEO of GE and friend of BHO. He would be taxed on the first $106,800. That means he would get a $2,156 tax cut. Warren Buffet makes $100,000 a year in salary. He would get a $2,000 tax cut. Not as much as Immelt but twice as much as Blago's $59k earner. Not only are gas prices up but so is jet fuel. Maybe Warren will use it to cover that.
Honeybee:
Responding to your post, you said "just imagine how much more hiring would happen if the economy was stimulated even more with some across-the-board tax cuts for everyone."
I agree with you, but ...
The crowd we have in Washington does not have the courage or the will to fight the hard battle to do what you suggest. With almost half the populace paying no federal income tax, that means a meaningful reduction could only take place by lowering the top rate. Those paying no taxes now have no skin in the game.
Then all the Dems have to do is start hollering about tax cuts for millionaires and the Repubs shrink back like Superman faced with a chunk of Kryptonite. Until both houses of Congress get serious about the budget and shrink it, we won't get tax reform.
What does this have to do with the unemployment discussion? Well, I think if the regulatory burden were eased sensibly and permanently, that would help. If business could devote fewer resources to lobbying (for less regulation) and they would not have to devote as many resources to compliance, lawsuits and permitting.
Then, they might even consider expansion within the US, and that would mean jobs.
I think that the Pres could do a lot of this by Exec Order. (Someone correct me if I'm wrong.) Unfortunately THIS Pres is not the guy to do that. Instead, we got a guy who, in a knee-jerk fashion, shut down drilling for oil in the Gulf, and today, said he thinks the federal government should acquire more land.
We have politicians in DC who are in love with Rube Goldberg-type "solutions." ObamaCare, Cap and Trade. I am convinced that this type of complex legislation is simply a means to keep the campaign contributions coming as lobbyists try to shape the outcome to suit their clients.
-- Frankj
Frankj wrote "With almost half the populace paying no federal income tax, that means a meaningful reduction could only take place by lowering the top rate. Those paying no taxes now have no skin in the game."
That may be true because you said "income tax" but anyone with a brain knows that the 15.3% TAKEN from us for "social security tax" is just another name for "income tax" because it ALL gets spent and nothing is really ever invested.
We should get honest about it all.... make EVERYONE pay that 15.3% on ALL their income with NO CAPs and then we can have a discussion about who pays how much.
The super rich are quite cleaver in how they get many in the middle class to pick on the poor for not paying their share while in fact many ARE paying more than the very rich... especially those who pay no tax because they put their wealth in muni bonds.... I'd love to see the tax free status for Muni bonds ELIMINATED at the same time we eliminate my home mortgage deduction AND eliminate the cap on Social Security Ponzi scheme.... Then we can get everyone talking about true tax reform. Why should I give a rich dude like Brinker a huge tax free muni bond income so some city in New York can build a bridge with low cost funds?
BTW Frankj. I hope my post didn't come off as if I was insulting YOU. I enjoy your posts and agree with much of what you write.
I'm feeling the frustration of having an incremental tax rate of 48% THEN AFTER I get the money I get to spend another 10% in sales tax in some California Cities that just raised their sales tax rate.
If I recall you are the tax expert. I read the radio dispatcher for the Palo Alto police department made about $120K in 2009 and that is about what an average senior engineer in the Silcon Valley makes. I am curious, if you count both sides of Social Security and Medicare in that salary, how much goes to taxes and how much do they take home of that $120K?
Sorry... I had too many little errors that didn't make sense in multiple posts so lets retry as a single post with errors, hopefully, corrected.
Don't forget we're talking about CA so you need to include State income tax.
Then as a comparison, put Brinker's numbers in the mix. Assume he does the radio show for some small fee and he has half the 200,000 subscribers he had in 2000 when he sent the "Buy QQQ in the $80s" bulletin. 100,000 subscribers paying $185 a year is $18.5M. Or use $37M if you think most stuck with him and new ones came along to replace those who know he didn't time either bear market worth a darn...
My rough estimate is the Social Security cap is less than 1% of that $18M, (0.5%) and he pays no STATE income tax because he claims to live in Las Vegas so he only has the top Federal tax rate to pay... (Federal Tax Rates) which is 35% for a total of maybe 36% when you add in his SS contribution.....
I hardly think a system is fair where even if you ignore state taxes, the engineer or police dispatcher paying 28%+15.3% or 43.3% of EARNED income to FEDERAL taxes while Brinker gets off paying only 36% of earned income to the Feds.
I'd feel differently if they actually invested Social Security, but since it is a Ponzi Scheme, it seems to have been put in by the very rich to screw us middle class workers.
Also, don't forget many of the super rich don't need to take any risk so they put the majority of their savings in tax free muni bonds so they don't pay any additional taxes while those of us investing in US Treasuries, CDs and stocks that pay dividends pay anywhere from 15% to 38% tax rate on the income.
"Then as a comparison, put Brinker's numbers in the mix. Assume he does the radio show for some small fee and he has half the 200,000 subscribers he had in 2000 when he sent the "Buy QQQ in the $80s" bulletin. 100,000 subscribers paying $185 a year is $18.5M. Or use $37M if you think most stuck with him and new ones came along to replace those who know he didn't time either bear market worth a darn..."
I've seen this 200,000 subscriber number for Brinker kicked around for so long it's become an urban myth.
I know the basis is "somebody" talked to "somebody" in Briker's office and they said they were busy because they had to mail out "200,000 special bulletin".
EVEN if that happened it's like saying don't bother me "I have a million things to do".
200,000 subscribers for an investment newsletter is a HUGE number and about what Lou Rukeyser used to have at the top I think. I've read that a 10,000 subscriber base for an investment letter would be considered very successful
But to base an argument on this specious number and then build a straw man is absurd.
Please provide a basis for Brinker's subscription number other than "somebody said to somebody".
And please don't ask ME to come up with a number because I don't know and I am not the one making the outrageous statement.
Kirk:
No offense taken. You are right that SocSec is just like a tax because of the way it is spent.
Right now, I have to go out, but answers later on the income question.
Hi Bob,
You bring up a very interesting discussion topic. I don't have time to properly address it this morning, but I promise you that I will.
Let's start with this statement that you made: ".....EVEN if that happened it's like saying don't bother me "I have a million things to do"."
So give me one reasonable reason why they didn't say that instead of stating a precise number like 200,000.
If 200,000 wasn't a ballpark number, then as you suggested, they would have said, "we have millions of subscriptions to get out."
Again, I will be addressing your post in depth now that you have put the subject front and center. Thanks Bob!
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"200,000 subscribers for an investment newsletter is a HUGE number and about what Lou Rukeyser used to have at the top I think. I've read that a 10,000 subscriber base for an investment letter would be considered very successful"
I see no reason to question a fairly precise number given by the Marketimer office. I can see how this is damaging to Brinker's image as it shows how very rich he is just from annual subscriptions in a country that loves to hate the rich and blame them for many of their problems. After running my tax example, I can understand why so many feel this way.. the very rich which includes Brinker don't pay the same percentage of income on taxes as the middle class.
But...
Back when I ran the investment discussion at another company, our discussion for "Bob Brinker" easily got 100 times more search hits than "Rukeyser"
I did a survey of a lunch table of older engineers at HP before I left in 1998 to see how many knew of Brinker. I was shocked so many subscribed to his newsletter... five or ten if I recall... they wanted to know what he was talking about on the radio since he was so vague with callers, liked his show and didn't see $185 a year as a big deal. I don't believe any of them subscribed to Rukeyser's newsletter.
I read in a press release some time ago Sheldon Jacobs had 18,000 subscribers to his newsletter. Jacobs didn't have a radio show on every weekend for six hours with the host using the airwaves to promote his newsletter by being vague and hinting the ONLY way you will get a straight answer out of Brinker was to pay. I know many, many who subscribed to Brinker's newsletter at one time or another but can't name a single one who paid for Rukeyser's. How many people listened to a 30 minute show on PBS that NEVER mentioned Rukeyser's newsletter compared to the millions who listen to Brinker for 6 hours every weekend around the country on AM radio? I'd be surprised if Rukeyser's subscription numbers came close to what Brinker had.
"I see no reason to question a fairly precise number given by the Marketimer office."
If you want to accept second or third-hand hearsay of something a Brinker office worker MAY have said as evidence.
The rest of the anecdotal evidence is scarcely hard numbers either.
Back in 2007 I think the Motley Fools were probably bigger than Brinker and even back then they only had 150,000 paid subscribers to SEVEN INVESTMENT advisory services.
..."In 2003, The Fool launched six additional print titles.
Today, they take advantage of a database of over three million free registered users
150,000 of them are active, paid subscribers to its seven investment advisory products, roughly a five percent conversion, generating roughly $22.5 million in gross revenue
They publish over 700 free articles a month on the website and through email, in attempt of converting free relationships into paid relationships
http://www.mequoda.com/reviews-and-studies/publishing-case-studies/the-motley-fool-media-network-case-study/
"Celebrating its 15th year anniversary this summer, the financial advice business created by these two financially-savvy yet playful brothers has evolved to serve and support the Fools community with 250 full-time employees.
Their flagship monthly subscription investment newsletter, Motley Fool Stock Advisor, has become the largest investment newsletter of its kind with more than 100,000 subscribers (within five short years).
http://www.cult-branding.com/article/motley-fool-brand.html
Bob
I have found that trying to determine the number of Marketimer subscribers is almost as difficult as finding out what Brinkers track record was as a money manager for the guardian royal exchange. I remember someone posting at 101 who called the marketimer office and was told they had 200,000 notices to mail. It is too bad all of those posts at 101 were deleted or we could see who made the claim and try to ask them about it.
Bob Brinker was also a partner in the B. J. Group. I think it was sold around 2000 for a multimillion dollar price with Brinker staying on for several years being paid as a consultant. Maybe someone remembers the details.
In the last hour a grandmother called in. She was planning to pay tuition for a grandchild and wanted to know if it was tax deductible. Bob's guest Barbara said it was not, but there were previsions that gave tax breaks to parents. Bob seemed unaware of this and ask her to give more details. She said there was an American opportunity credit and tuition credits. Bob ask when this started and she said it began in 2009. I wondered why Bob or Barbara didn't suggest she gift the money to the parents. They pay the tuition and then they could take the credit on their return. Maybe one of the tax professional who posts here could tell us if that idea would work.
CHAPEL HILL, N.C. (MarketWatch) — Tuesday marks the 78th anniversary of an event about which most Americans are completely ignorant, but one which looms quite large among an older generation of gold investors.
On April 5, 1933, President Franklin D. Roosevelt signed an executive order forbidding U.S. citizens from owning gold.
It remained the law of the land for more than four decades. Only on Dec. 31, 1974, was it finally repealed.
If you’re younger than your late 50s and were therefore no older than high-school age on the latter date — if even born — then you take for granted the ability to invest in, and trade, bullion. You might even implicitly assume that it’s been forever thus.
It’s somehow fitting, then, that on this anniversary, gold itself is trading at a new all-time high. See more on gold futures tipping $1,450 an ounce for the first time.
If you decide to buy some gold today, perhaps you can acknowledge your debt to the many libertarians and countless others who lobbied for years for the repeal of FDR’s edict.
— Mark Hulbert
Kirk:
You asked, "if you count both sides of Social Security and Medicare in that salary, how much goes to taxes and how much do they take home of that $120K?"
I made some calcs based on that salary for 2010, and assumed the individual was married, filing jointly.
$6622 comes out of the pay for SocSec. That is 6.2% of the first $106,800. Then 1.45% comes out of the total pay of $120K for medicare so that is another $1740.
Total out of employee gross pay is $8362. Multiply x 2 because the employer has to match it. So that gets you to $16,724.
There may be unemployment taxes the employer has to pay but I didn't consider these.
On a salary of $120K, the taxable income would be $101,300. (Subtract the standard deduction of $11,400 and the 2 personal exemptions of $3650 each from the $120K).
The tax on $101,300 is $17,688. Then you subtract off the Making Work Pay credit of $800 to get $16,888.
Including the employer share, there is $33,612 in tax being paid on this gross salary of $120,000.
Now the disclaimer: this is a very simple example in the sense that someone at this salary would probably have a lot of other stuff going on that affects the return.
Things that would bring down the tax owed: kids, credits from education expenses, itemized deductions.
Things that could increase it: investment income and activities that could trigger the alt. minimum tax.
I don't know about CA state taxes except they top out at about 10%, so mentally add something to the above. Then there are all the non-salary related taxes, like sin taxes, gas tax, phone-related, real estate, and taxes that municipalities add to utility bills.
Frankj
Thanks Frank but I asked for a single earner with no kids making $120K. They don't get the "make work credit." We all know someone making $60K writing off kids and getting the latest credits is far lower in the tax brackets....
And I also wanted to know what the employer pays so consider the person self employed. After all, if HP didn't have to pay SSDI to the government then they could pay it to that engineer and still have the same PT&B.
A senior engineer or that Palo Alto police dispatcher, both making that $120K, could have the kids out of college and they are divorced so this is pretty typical for the South Bay Area I'd think for many at that salary level.
Three cheers for Congressman Paul Ryan's 2012 budget plan to save more than $6 trillion over the next decade. It is sure to come under fire from the DC do-nothings and called extreme from the liberal lapdogs. This crowd thinks cutting $30 billion out of a $1.5T deficit is extreme.
The plan may be flawed and subject to much debate and compromise. So be it. Finally, a man-sized proposal to turn this country toward fiscal sanity. Mr Ryan is to be commended.
Hi Bob,
You seem heck-bent to make a comparison between the Motley Fools and Bob Brinker. I think that's ridiculous.
I know very little about the Fools, but I did a search and see that they are still on the air -- how much and when I didn't take the time to find out.
However I was very surprised when I went an archived program and heard the same opening bumper music that Bob Brinker uses. Who copied who? Do you know?
Here are the words, Moneytalk listeners will recognize it immediately:
"Everybody needs money. That's why they call it money."
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Birdbrain,
Hear! Hear! to everything you said!!
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Kirk:
Ok, I'll try again. Maybe it is a geographic thing ... where I live, any guy making 120K would have been "picked off" and would NOT BE filing Single, believe me!
What I presented did not include any kids. The 2 personal exemptions referred to would be the taxpayer and the spouse.
If the scenario is a Single filer then it is still pretty simple:
Standard deduction $5700 and the one personal exemption, $3650. Taxable income $110,650. Tax owed, $24691. Subtract from that, what a single filer gets for the making work pay credit, which is $400.
You said, "Thanks Frank but I asked for a single earner with no kids making $120K. (MY ANSWER IN CAPS: COMMUNICATION MISCUE, WELCOME TO THE WONDERFUL WORLD OF TAXES, YOU HAVE TO BE VERY CLEAR AND SPECIFIC. OK, THE SINGLE FILER INFO IS GIVEN ABOVE. AND NEITHER SCENARIO, THIS POST OR THE PREVIOUS ONE, INCLUDES ANY KIDS.
You said, "They don't get the "make work credit."
YES,SINGLE FILERS DO GET THIS CREDIT.
You said "We all know someone making $60K writing off kids and getting the latest credits is far lower in the tax brackets...."
YES, THIS IS CORRECT, TO QUOTE CINDY LAUPER, "MONEY CHANGES EVERYTHING." I.E, MORE MONEY OR LESS MONEY CAN REALLY CHANGE YOUR TAX RETURN.
"And I also wanted to know what the employer pays so consider the person self employed."
OK, YOU DIDN'T ASK ABOUT THIS IN THE INTIAL POST. THE SELF EMPLOYMENT TAX IS 15.3 %. SCHEDULE SE AS PART OF THE TAX RETURN. HEY, ITS LATE AND IF CAN WAIT UNTIL TOMORROW, (OR NEXT WEEK AS BB SAYS), LETS DO IT THEN.
"After all, if HP didn't have to pay SSDI to the government then they could pay it to that engineer and still have the same PT&B."
WHAT IS PT&B? PAYROLL TAX AND BENEFITS?
IS WHAT YOU'RE GETTING AT THE DIFFERENCE BETWEEN A REGULAR EMPLOYEE AND A "1099 EMPLOYEE?"
STAY TUNED, I CAN TRY AND GIVE YOU AND OTHERS A COMPARISON.
Honeybee, are you SURE can't PAY me for this???
Frankj
"You seem heck-bent to make a comparison between the Motley Fools and Bob Brinker. I think that's ridiculous."
I wasn't trying to compare the two HB, but simply trying to show that ANY newsletter with 100,000 subscribers is rare.
To say Brinker has 200,000 subscribers because some telephone operator in his office MAY have made an offhand comment is a real stretch.
Here's another one I just found. Uncle Lou had/has only 43,000 subscribers.
Louis Rukeyser's Newsletter Subscriber Masterfile
GreatLists # 2253
43,184 TOTAL USA ACTIVE SUBSCRIBERS
Bob said...
"......I've seen this 200,000 subscriber number for Brinker kicked around for so long it's become an urban myth.
I know the basis is "somebody" talked to "somebody" in Briker's office and they said they were busy because they had to mail out "200,000 special bulletin".
EVEN if that happened it's like saying don't bother me "I have a million things to do".
200,000 subscribers for an investment newsletter is a HUGE number and about what Lou Rukeyser used to have at the top I think. I've read that a 10,000 subscriber base for an investment letter would be considered very successful
But to base an argument on this specious number and then build a straw man is absurd.
Please provide a basis for Brinker's subscription number other than "somebody said to somebody".
And please don't ask ME to come up with a number because I don't know and I am not "
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Bob
Great to have you here defending Bob Brinker. I was beginning to think the only defender left as our old friend marc ultra over at SI.
Why is it such a bid deal for "Bob" to try and discredit what someone says the Marketimer office told them?
Only a moron would be fooled by his attempts to say a direct quote from Bob Brinker's Marketimer Office is hearsay then he makes up statistics with no references to justify why he doesn't believe the people in Brinker's own office who would have no reason to lie about this number.
Why shouldn't Brinker have 200,000 subscribers? If he's making everyone rich with his advice, I would think everyone who is a regular listener would find $185 a pittance.
I'd expect him to have a million subscribers if he has a million listeners and his advice worked.
People wouldn't produce late night informercials with a room full of paid actors if that sort of advertising wasn't effective. Brinker is brilliant as he figured out how to do this on someone else's dime. A product that appears to be no more effective (compared to buy and hold VTSMX, FREE ADVICE) than the black hairspray sold to cover bald heads on late night TV.
"Bob
Great to have you here defending Bob Brinker. I was beginning to think the only defender left as our old friend marc ultra over at SI."
LOL! Here I am claiming Brinker has far FEWER subscribers than most folks here claim he has and you call that defending him?
But even though I have no evidence, I would be willing to bet that Brinker has far less than 100,000 subscribers. How about you jeff?
I got it! I could just say I read somewhere that somebody claimed they called Brinker's office and somebody there said subscriptions were less than half of what they used to be.
That should do it.
"Only a moron would be fooled by his attempts to say a direct quote from Bob Brinker's Marketimer Office is hearsay..."
What else would you call a second or third-hand report of "somebody" who "said" they called Brinker's office and "somebody" there said yada yada yads?
The rest of your post makes no sense either.
The plain fact is you have no absolutely no support for your claim other than unsubstantiated hearsay.
I hate to interrupt this discussion about how many millions that Bob Brinker has made all because he came up with an ingenuous business plan many years ago.
You have to give the man credit. He had experience behind a microphone and experience in "Wall Street." He combined them, got his own show and the rest is history.
Now you might think this is an American success story if you didn't know the whole business plan would not work if he didn't practice deceit and shyster-like cover-ups, both on the air and in the newsletter.
His Business Plan includes so-called timing models, model portfolios, gift-horse buys, cyclical/secular hocus-pocus.
All designed to sell newsletters with carefully chosen revelations made on the radio.
It's positively brilliant. He controls 99% of what gets on the air. He can pick and choose any market-timing starting point that will snag another sucker as he totally BURIES his damaging advice.
And he does all this while belonging to the church of buy-and-hold through major bear markets, and STILL convince listeners that he is a market-timing genius.
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Silver is now at a 31 year high:
By Myra P. Saefong and Polya Lesova, MarketWatch
SAN FRANCISCO (MarketWatch) — Gold futures rallied above $1,460 an ounce to a new intraday record and silver prices hit a 31-year high Wednesday, as investors flocked to the safe haven of precious metals."
My AGQ holding is looking mighty pretty at $248.66 right now.
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Kirk:
A MARRIED taxpayer, Self-employed and grossing 120K ends up paying $30,977 in tax. About half of which are self-employment taxes.
This is a little less than the example of the married taxpayer who was an employee.
However, in a real life situation, it is likely that the self-employed would have a number of expense items that would make for a much lower net income.
Take a look at Schedule C first, thats where your self-employment income is calculated. The result of that goes to schedule SE which is where the TAX on your self-employment income is figured. Essentially, these are the payroll taxes normally deducted for an employee.
The self-employed get to deduct one-half of this total from their income. See line 27 of the 1040 form.
From line 38 on form 1040 to the bottom of the form the calcs are similar for the employee vs. the self-employed, with one exception. The self-employment tax gets plugged into line 56 and added to the tax entry on line 46.
-- Frankj
marc ultra sound-a-like says "The plain fact is you have no absolutely no support for your claim other than unsubstantiated hearsay."
Which begs the question, since you have no answers or facts, and stated so, WHY DO YOU CARE?
Is the IRS reading this, or something?
"Which begs the question, since you have no answers or facts, and stated so, WHY DO YOU CARE?"
Well pig, since HB says she only allows verifiable truthful posts here I thought the unfounded claim of 200,000 Brinker subscribers should not go unchallenged.
To start from a totally unverifiable claim and then build a story based on that claim in a futile attempt to discredit Brinker boggles the mind in the truth department.
And I haven't even mentioned that the 200,000 claim and attendant story built on the claim come from a long-time would-be Brinker competitor.
Interest Rates to Rise in 2012: Bond Fund Manager
April 6, 2011
The Federal Reserve will end its bond-purchase program in June but will put off raising interest rates until next year, says Jeff Given, a bond fund manager at John Hancock. He sees rates on the 10-year climbing to a range of 4 to 4.5% vs. 3.5% today. Interview by MarketWatch's Deborah Levine.
http://www.marketwatch.com/video/asset/i....F-9DE53CF681F9#!1BB8CDCC-1329-42EF-861F-9DE53CF681F9
Thanks Frankj. I guess it is a lot of work. I've taken my return in TurboTax, made a "test what if" copy then flagged a few places where I can add $10K to the LT gains on a phantom investment or add $10K to my newsletter sales.
I already lost the "make work pay" credit which is a real disincentive to work hard this year if it pushes me above that again when you add it to the 48% incremental tax hit I'd take on an additional $10K of earned income that I would file on my Schedule C or get with 1099-misc from some of my advertisers. When you consider once I get that roughly $5,200 from an additional $10K in sales I'd have to pay as much as 10% sales tax to buy something... we're talking about net $4,600 worth of extra goods and services for an extra $10K work... It is really a disincentive to work hard for the extra $10K...
But, given Brinker with maybe $5M to $50M a year in newsletter sales doesn't have to pay the incremental SSDI taxes nor the CA taxes... it seems his incremental payment to government for an extra $10K is only the top US tax rate, or 35%. Hardly fair to me and it explains why so many in the middle are upset at the "Free loaders" at the bottom AND the free loaders at the very top who pay far less of their income to support our government...
I would not feel this way if SSDI payments were invested but last year Obama took my payments and sent them to the states to pay teachers and cops and other government worker benefits that are far, far better than us paying into SSDI get... so I'm pissed.
Bob said: "Well pig, since HB says she only allows verifiable truthful posts here I thought the unfounded claim of 200,000 Brinker subscribers should not go unchallenged."
Au contraire my friend....
I have said that quotes or anything taken from other sites, need to have links attached. That's simple courtesy to the authors.
But -- the big one -- personal opinions and RECOLLECTIONS are very welcome -- all opinions, all the time.
I thought I had made that clear since I post my opinions so frequently. LOL!
PS: Kirk's memory is 100% right about the 200,000!
But isn't it sad that Bob Brinker's lawyers strong-armed S101 into deleting ALL posts about him. At least 100,000 posts were wiped clean, including all of my Beehive posts that were there -- with no warning, as they had promised to give before making deletions.
Pretty convenient way to avoid giving a chance to save them, hmmmm?
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One more thing, very near the beginning, Bob Brinker tried to strong-arm Kirk into censoring certain posts from his Suite 101 discussion forums.
He didn't get to first base with Kirk. You have to respect a guy who will stand up to the big, fatcat, rich, bullies to protect his posters free speech.
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marcc ultra sound-a-like threatens "And I haven't even mentioned that the 200,000 claim and attendant story built on the claim come from a long-time would-be Brinker competitor."
You haven't mentioned that? Geesh, I must be losing my mind, as tiny as it it is. I could have sworn that I saw it somewhere.
Perhaps you can connect the dots for me, since I'm STOOPID. What does 200,000 have to do with a long time brinker competitor? Are they both going after the last live subscriber? Is there a contest for an all expense paid trip to Gary Indiana or somewhere?
What does this competitor have to gain by saying that brinker is hugely successful?
Me dont get it!
Michael Haynes, the CEO of APMEX talks about gold and silver on CNBC. Short video, but very informative if you're interested in the subject.
"Historically, precious metals have provided a hedge against economic instability, sovereign risk, and lowering of U.S. currency values through inflation and the overprinting of currency," said Haynes.
.
What does this competitor have to gain by saying that brinker is hugely successful?
Me dont get it!
Me don't get answers either.........
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