Wednesday, November 23, 2016

Dec. 4, 2016: Auxit/Italy's referendum. Europe in Chaos. Buying Time!

Enough hating Donald Trump. Let's talk about hating the EU.

On December 4, 2016, two major decisions will be held in Europe: the Italian Referendum and the Austrian Election.


Italy has something called a bicameral system meaning two houses of equal power. Imagine two large but equally in size and power nations. Italy call these the Chambers of Deputies and the Senate of the Republic. For a law to be passed both nation has to agree ON THE EXACT BILL WORDING AND ALL. Which in other words mean laws move slower than the US congress. So the Prime Minister of Italy, Matteo Renzi, decided to reform the Italian parliament to allow for faster legislation approval. Under the new guidelines
  1. The Senate loses power. Instead of deputies and senate it will be "local and central institutions."  
  2. The Senate goes from 315 to 100 and the senators are picked from regional council (no longer elected)
  3. Pro
    1. Less power to senate means bills are quicker to pass
    2. Centralize power to the central govt 
  4. Con
    1. Basically destroys the senate.
    2. People only vote for half of the Parliament, the other half is based on nepotism. 
    3. Local govt have less say and centralize power to the central govt 
So why does this affect the EU?
  1. Italy has been growing at an anemic pace (sometimes negative)
  2. Renzi is a pro-EUer and stated that if this referendum fails he would step down.
  3. His absence would create a huge power vaccum.
  4. There is strong support for NO from both the democrat and republican.
  5. But I have a feeling the vacuum will be filled by the 5 star party/movement
    1. 5 stars is a proenvironmental, anti-establishment, anti-globalist, and euroskeptic party
    2. the 5 stars represent their beliefs of 1) Public water, 2) Sustainable transport, 3)sustainable development, 4) right to internet access, and 5) environmentalism.
  6. The 5 star has captured 2 mayoral positions (including rome) and is the biggest threat to the left-right parties of the EU. It's basically the populist movement as we've seen in the UK and US. Anyone but a politician.
  7. Last year the 5 star were seen as a far right fringe group. But with the rise of Brexit and Trump I have a feeling the populist movement is gaining momentum. Stagnated economy, false inflation/gdp growth by the central bank, and no wage growth is starting to make the masses angry. Perfect rich environment for a populist. I think this was the reason for Brexit and Trump rising. The economy is booming, GDP is growing, and stock market is higher! But it benefits little for the average person.
  8. Filipino President Duertes came into power the same way.
Austria Election

Norbert Hofer (Freedom party of Austria) vs Alexander Van Der Bellen (Austrian Greens)

On April 24, 2016, Alexander Van Der Bellen was elected as the new president by 30,000 votes. But there were numerous arguments of voter fraud and improper counting. Such as a 147% turnout Waidhofen an der Ybbs and an impossible turnout in Linz. 

On July 1, 2016, the Constitutional Court ruled that the election was improperly handled. 30,000 votes were prematurely tallied, 50,000 votes were counted by unauthorized personnel, and 500,000 votes were invalid. The Court ordered a new election which is now Scheduled Dec. 4, 2016.

Why it matters

  1. Hofer is an anti-EU skeptic like the 5 star party.
  2. Hofer is narrowly leading the polls as of today.
  3. Although Hofer said he would not leave the EU he has indicated his desire for Austria to regain autonomy from Merkel and Brussels,
Investment Strategy

  1. Foreign stocks have been dropping lately in anticipation of these votes. 
  2. If the referendum loses and Hofer wins the Euro will crash and the dollar will skyrocket.
  3. Stocks that relies largely on the euro or foreign monies will crash
  4. Buy list:
    1. Unilever (UL) 
    2. Phillip Morris (PM)
    3. Nestle (NSRGY)
    4. Diageo (DEO) 
    5. National Grid (NGG) 
    6. Multinational American Stocks like we saw after the Trump Election.
Good Luck Everybody.

Monday, November 14, 2016

Recent Buy: UL

On November 14, 2016, I bought 12.6968 shares of Unilever (UL) for a total of $500 in my loyal3 account.

This is probably my last buy until the rate hike (except for maybe DEO).

Forward dividend is $1,049.73. 

Thursday, November 10, 2016

Buy: FLO

On November 10, 2015, I bought 100 shares of Flowers Food (FLO) at $15.50/share for a total of $1557.00. This will increase my forward dividends by $69.00 to a total of $900.19.

Thinking back it might have been a good idea to sell off all my stocks and go 100% cash. If I knew Trump was going to win and crash the multinationals I would have rigged the elections myself.

Trump 2016! Making my portfolio rich again!

Watch List: PM, MO, DEO, UL, CL, CLX, HRL, KO, SO, WTR, VTR, PEP, GIS, CHD, and BGS.

Wednesday, November 9, 2016

Recent Buy: ABT, UL, and T

To celebrate making America great again. 

On November 9, 2016, I bought 100 shares of ABT at $40.00 a share for a total of $4007.00, 100 shares of T at $37.40 for a total of $3,747.00, and 24.2372 shares of UL for $1000. Total this adds $236.19 to my forward account (i also added my regular FCISX). 

I'm looking at CAH (even at a discount after this rally), UL, KO, MO, FLO, HASI, LTC, OHI, and O. It's nice to have dry powder. 

As an aside I am old enough to remember when X won the white house

Reagan won: Democrats said that he would destroy the US and cause WW3

Bush 1 won: Democrats said that he would destroy the US and cause WW3

Clinton 1 won: Republicans said that he would destroy the US and cause WW3

Bush 2 won: Democrats said that he would destroy the US and cause WW3

Obama won: Republicans said that he would destroy the US and cause WW3

Now Trump wins: Democrats are saying he will destroy the US and cause WW3

I'm not old enough to remember carter, LBJ, JFK, Ford, etc but I bet it's the same thing.

Take a blast in the past look at our old political parties. People forget that the US has one of the strangest dictatorship in the world. Every four to eight years our dictator steps down and let another dictator step up. Only difference this time is our new dictator came out of no where.  

Tuesday, November 1, 2016

Recent Buy: A boatload of stocks

This is my first ginger harvest. It was a plant I grew a while back and finally decided to uproot on Halloween. Spooky Ginger.

Besides that here are my stocks as of October 31, 2016. I am only making small loyal3 buys for now and the rest goes to my bank. Now for the good, bad, and ugly.

Ticker # of shares1Q Dividannual Contribution

Good news!
  1. I got a "promotion." Instead of 35 hours a pay period for OT I now work 60! I hate working OT but the money is too good (especially for the upcoming recession)
  2. The seller took $5000 off the land and $5000 off the home because I paid in cash! I don't have a mortgage anymore! Hooray!
  3. I put 3,500 into the market and the other 6,500 went to the bank.

Bad News
  1. My mom's surgery had complications and required multiple trips to the hospital and ER.
  2. That 6,500 is gone now.
  3. to be honest I kinda expected this but I'm surprised of how cheap it was. I was expecting 45k or so but it only cost me $6,500. (that's why when I sold off my old portfolio and bought the house I had that 45k left in the bank)
  4. To Summarize: I planned for something and it happened but it wasn't that bad 

Ugly News
  1. 10-20% drops after missing earnings. The market is going nuts

  1. The market is still going to bust. We've seen reits getting hammered as bond yields goes up.
  2. I am using this opportunity to remake my portfolio. There were several stocks I didn't like in my old portfolio like TROW, TIS, GILD, NRZ, etc. I bought those on a whim and didn't do my due diligence. As a more experienced investor I'm starting to get it (well some of it).
  3. Instead of being a full dividend investor I'm going full total return. My goal is to add some high cash flow stocks that will eventually pay dividends. 
  4. Instead one or two brokers I want several. A bunch of them for different things
    1. Loyal 3 for my free trades.
    2. Scottrade for my common buys.
    3. Vanguard for my etfs.  
  5. Here is what I want in my future portfolio. 
Consumer Defensive


Sin Stocks


Consumer discretionary 





JNJ, AMGN, CAH, MCK, ABT (ABT/CAH/MCK might be getting close)


EMR, not sure what else 







Growth Stocks with dividend potentials


Speculative Stocks


Vanguard ETFs

VTI, not sure what else. 

If you have any suggestion I'm all ears. I'm not investing in oil or commodity stocks anymore. I'm getting too old.