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  • Happy Hour: Share Supply And Bond Sell Off

    May 31, 2013

    ·

    Jon

    Welcome to the end of the week and another edition of Happy Hour! Just sit back, relax, and enjoy your end of the week roundup of all things interesting in the land of  money.

    Share Supply

    One driver of stock prices is supply. Now I don’t want to get into the supple/demand explanation. Basically, much of the price movement or big price movement is based on the number of shares available.

    This was very clear during the dot-com price spikes in the ’90s. New companies would IPO such a small portion of its shares, demand would outweigh supply, and prices would escalate. Continue Reading…


  • ETFs For Rising Interest Rates

    May 30, 2013

    ·

    Jon

    Rising Interest RatesThe recent Fed hints at ending QE means rising interest rates. It also means big changes in the markets. Here are several ETFs to protect yourself and invest in as interest rates rise.

    Let’s keep this simple. Back in September the Federal Reserve announced QE3 which expanded its bond buying program to $85 billion per month and added mortgaged backed securities to its buy list. This did two things:

    • Lowered long-term interest rates by pushing bond prices higher (explained here)
    • Supported the mortgage market

    This was done to spur economic growth and hiring. It wasn’t going to last forever, either, and the Fed is already planning the unwind. Continue Reading…


  • Happy Hour: Apple Tax Hearing And Fracking Beer

    May 24, 2013

    ·

    Jon

    Welcome to the end of the week and another edition of Happy Hour! Just sit back, relax, and enjoy your end of the week roundup of all things interesting in the land of  money.

    Apple Tax Hearing

    Misdirection is used to deceive an audience by focusing their attention on one thing in order to distract it from something else. Magicians use it all the time. So do politicians.

    Apple’s tax practices were dragged through the mud this week in a lame attempt to shift blame for the abysmal tax code our elected officials voted into law. The idea that Apple or any company is somehow skirting their duty by not paying taxes is ridiculous. It’s still in the best interest of shareholders to maximize profits, right? That still includes using legal means to lower the tax bill. If you’re an Apple shareholder you should be applauding all the way to the bank. Continue Reading…


  • Stock Basics: All About The Dividends

    May 23, 2013

    ·

    Jon

    DividendsWhether a stock pays dividends may play a big role in your investment strategy. A dividend provides a source of income. It offsets losses. When reinvested, it compounds growth. But this isn’t an argument that dividend paying stocks are better. It’s an introduction to dividends, giving you an idea of what to expect and what to watch out for when owning dividend stocks.

    There are three things a company can do with its profits. Reinvest it to further grow the company. Do a share buyback, which should increase the stock price over time. Or return the money to shareholders in the form of a dividend. Most companies combine the three to offer the best return for shareholders.

    What Is A Dividend?

    A dividend is a piece of a company’s earnings paid out to shareholders. When a company pays a dividend it’s usually done quarterly. There are a few companies that only pay annually or bi-annually, but it is not the norm. Continue Reading…


  • Stock Buybacks: Creating Shareholder Value?

    May 21, 2013

    ·

    Jon

    Stock BuybacksA common way for companies to return money to shareholders is through stock buybacks. When done right, it’s the easiest way a company can increase shareholder value outside of growing the company’s earnings.

    Rightly so, stock buyback announcements are seen as a good thing. But what effect do buybacks have on your shares? And are all buybacks a good thing? Here’s what you need to know.

    What Is A Stock Buyback?

    A stock buyback or stock repurchase is an indirect way to return money to shareholders. The company buys back a portion of its own stock to lower the number of shares outstanding. This increases the value of the remaining shares. Continue Reading…


  • Happy Hour: QE Hints And Amateurs

    May 17, 2013

    ·

    Jon

    Welcome to the end of the week and another edition of Happy Hour! Just sit back, relax, and enjoy your end of the week roundup of all things interesting in the land of  money.

    QE Hints

    It’s the most anticipated event in years. When is it? How will it happen? What are the consequences? The idea that anything financial lasts forever usually gets people in trouble. While we all have our views of QE infinity or unending QE, I hope you didn’t take it literally. I vaguely remember folks believing the same with housing prices and dot-com stocks. But I digress. Continue Reading…


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