Stocks, bonds and investing

[Morat20]

No, it's an option for the return. Ye Olde paper bonds, even. They've otherwise done away with paper bonds almost completely.

I did a bit of quick homework and they seemed decent (if ultra-conservative, but that's me) to stash some money in to hold some value vs stashing it in a mattress. I really don't want to invest in stocks, but I won't get into my crazy coot rant about how the stock market is destroying 'merica.

Hey, I'm still pissy my company match is all in their stock. :( I don't buy my company stock otherwise, and I'd divest of it if I could.

I've got my 401 split between bonds, large-scale indexes (stock portfolios designed to mimic the S&P 500, that sort of thing), and one of those retirement-date funds. I've got more in company stock than I'd like, but they're matching a sizeable amount a year, so...*shrug*.

Right now I'm deciding if I want to bump from 16 to 17% withholding next year. 16 is probably enough, though. I haven't actually seen a real raise in five years. It's eaten up by bumping my 401 a full point and benefits increases.

[Paelos]

A match is a match. Assuming the stock doesn't drop to 10% of the value you got it for, you're going to make out like a bandit on any match you get.

[Sky]

Yeah, I miss the matching Walmart used to give when I was there. Both 401k and stock. The library, it matches nada, though I am vested in the NYS retirement system through an old loophole, so that's cool. If there's any money in it twenty years from now.

[ghost]

Facebook sinks ~15% today.  That didn't take long.

[MahrinSkel]

Here's why.  Essentially, Facebook is past it's exponential growth phase and is now at best linear, if not completely plateaued (there's another chart out there that plots Facebook growth against Friendster and MySpace growth, that essentially says plateauing is the best case scenario now, the historical record would call for a slow death).  The monetization it might manage on its existing userbase does not justify a $100B valuation, no matter how you spin it.

--Dave

[ghost]

Their quarter over quarter ad revenue growth was even in the negative a couple of times according to that graph.  Interesting stuff.

I'll stand by my theory that the big time shareholders (including Zuckerberg) were cashing out at just the right time with the IPO because they knew that it was going to be a slow declining platform. 

[MahrinSkel]

Their quarter over quarter ad revenue growth was even in the negative a couple of times according to that graph.  Interesting stuff.

I'll stand by my theory that the big time shareholders (including Zuckerberg) were cashing out at just the right time with the IPO because they knew that it was going to be a slow declining platform. 

It does kind of remind me of the AOL/Time Warner merger, they're converting hype to money before the reality sets in.

--Dave

[ghost]

Fuck, Zuckerberg is already richer than the Google guys.  It's insane. 

[Ironwood]

Well, sure, but is he happy ?

 

[Draegan]

Doubtful, you ever see how the man ties a tie?

[Teleku]

Happiness is having no idea how to tie a tie, trust me.

Well except for about 20 minutes before that job interview you need to make it to on time, and then you suddenly realize you can't remember.  Not that I speak from experience.

[Surlyboi]

I can tie a tie and I'm quite happy.

Then again, I wear one a lot now that I don't have to more than I ever did when I was a banker.

[KallDrexx]

It gets better!

facebook under investigation for Violations of laws relating to their ipo

[Paelos]

Don't be shocked when Zuckerberg screws over a bunch of people to make a buck. Again.

[ghost]

Paul B. Ferrell feels that Facebook may be the Black Swan that kills us all.  

Now we've gone the other way.  

Addendum-  maybe this guy's right.  It is alleged that Morgan Stanley was doing some pretty shady business in covering up the weaknesses of Facebook prior to the IPO. 

The report, and now the lawsuit, raises questions about whether Morgan Stanley, one of the underwriter companies that handled Facebook's IPO, or other banks knowingly offered certain investors privileged information that should have been made public. Other underwriters targeted by the lawsuit include Barclays Capital, Goldman Sachs, JPMorgan Chase and Merrill Lynch, a unit of Bank of America.

It is possible that Morgan Stanley may have signed off on a price that was too high or agreed to sell too many shares in the deal, CNNMoney.com reports. Then, Morgan Stanley analysts are alleged to have told certain people they had a negative assessment of the social network's offering.

"If true, the allegations are a matter of regulatory concern to FINRA and the [Securities and Exchange Commission]," Ketchum said in a statement via a spokeswoman.

The New York Times reported Morgan Stanley did more than just quietly share a negative outlook; they actually "held conference calls to update their banks' analysts on business."

"Analysts at Morgan Stanley and other firms soon started advising clients to dial back their expectations," the article says. "One prospective buyer was told that second-quarter revenue could be 5 percent lower than the bank’s earlier estimates."

[Surlyboi]

Ah, there goes the Morgan I used to know and loathe.

Glad to see that they're still up to the same shit years later.

[ghost]

But wait.  It gets better........

Morgan Stanley and other underwriters have made a profit of about $100 million stabilizing Facebook Inc. stock since trading began on Friday, people familiar with the matter said.

As the lead underwriter responsible for Facebook’s IPO, Morgan Stanley would receive the largest chunk of those profits, the people said. The bank would receive the money on top of millions of dollars in IPO fees, the people added.

Let's see......support IPO, drive up prices as high as possible, short sell shares.....Boom!  There's a hundred million dollars.  This is amazing. 

[Surlyboi]

Business as usual.

[pxib]

Indeed. This is only unusual in how publically brazen and obvious it is.

[Chimpy]

The asshats on Wall Street have been given free reign for so long that they have lost any need to hide their shenanigans anymore because they know they will never be held accountable.

[MahrinSkel]

They scammed *rich people*.  That's still a crime that gets investigated (but not necessarily prosecuted, see Jon Corzine/MF Global).  The ones that are going to get seriously pissed are the ones that Goldman hooked on the last round of private financing that can't sell until 6 months after the IPO, while the earlier investors got to cash out immediately (much of why the IPO fizzled is because it was just too big, and it was so big because of the insiders cashing out).

This is the top 1/10th of one percent turning on each other because there's nobody else left with enough money to be worth scamming.

--Dave

[Surlyboi]

They scammed *rich people*.  That's still a crime that gets investigated (but not necessarily prosecuted, see Jon Corzine/MF Global). 

How do you think I made my money? They only investigate it if you don't make those rich people a modicum of profit, or at least allow them to break somewhat close to even.

[Ironwood]

I was gonna guess hooking.

[Surlyboi]

Hooking is more honest. 

[bhodi]

How do you think I made my money? They only investigate it if you don't make those rich people a modicum of profit, or at least allow them to break somewhat close to even.

Funny, a guy I know said the same thing in a chat we were having yesterday.

I mean that a) the underwriters are going to get sued and pay up, b) the stock is dropping like a rock, and c) I would not be surprised to see a lot of short interest in FB.
on point c… Zuck annoyed wall street by wearing his hoodie and not sucking up to them. I would not at all be surprised to see tons 'o naked shorting going on.
http://wallstcheatsheet.com/stocks/is-this-the-real-reason-behind-facebooks-plunging-stock.html/

Wall Street likes to fuck people who annoy them.  Just ask Jeff Citron.
http://www.investopedia.com/terms/s/soesbandits.asp#axzz1vcjj2Oq6
http://blog.themistrading.com/soes-bandits-revisited/

Today we are going to do a little electronic trading history lesson.  Who remembers Sheldon Maschler?  Harvey Houtkin?  They were the original SOES Bandits.  Sheldon headed up the infamous Datek Securities.  In 1989, with the help of two boy wonders, Jeff Citron and Josh Levine, they created Watcher, a software program that allowed day traders to take advantage of a weakness in the SOES system–relatively slow updating of price quotes.

Sound familiar to anyone? One thing I have learned.  If you fuck the big boys they will fuck you back sooner or later.  You only get to play by their rules.

(Question by another guy) Isn't that type of thing what got cartine beat down in the currency markets?

No, they were playing the currency markets differently. they were doing exchanges from A -> B -> C -> D -> E -> A where the marginal differences between them gave you a profit on going back to A
The problem was that some of the C and D currency markets were so small that their trades were causing them to deflate precipitously over a short period of time
Cartine basically exploited arbitrage loopholes in currency but didn't have the backing of the big boys. So what he did was viable and 'legal', but because he wasn't sharing, they came after him
Stealing is fine, as long as you are sharing with the right people. That's the lesson in both cases

That's the reason that they weren't charged with anything. What they were doing was totally legal.

My comment was "If Jeffy is considered fucked, bend me over. He still got hundreds of millions". And he did. And he bought a huge yacht with it. It's a pretty nice looking yacht.

[Surlyboi]

Bingo. I get to run around New York, the Hamptons and the Bay Area like I own the places I hang mostly because I and my group at MS fucked people enough to make us some cash, but not enough to cause them any real pain.

[Viin]

We haven't had a good investing discussion lately, so maybe we should stir one up!

What's your strategy for 2015? Day trading? Dump it all in S&P 500 and don't look back? Buy gold bullion?


A family friend convinced me to put some money into super special fund via a 401k rollover, but this is what you get when you don't do what you know you should:

[Abagadro]

Yeesh. Those F-Squared yahoos just got hammered by the SEC for 35M in penalties for fraud. Get your money out of there if it is still sitting in there.

I'll do what I have been doing for 20 years, bi-monthly dollar-cost average buys of broad based index funds in tax-deferred or tax-advantaged accounts and then don't touch it.

[Viin]

Yeesh. Those F-Squared yahoos just got hammered by the SEC for 35M in penalties for fraud. Get your money out of there if it is still sitting in there.

Ahh hadn't noticed that, thanks for pointing that out. Now to start yelling. 

[Abagadro]

http://www.sec.gov/litigation/admin/2014/ia-3988.pdf

http://fortune.com/2014/12/22/sec-f-squared-fraud/


They basically back-analyzed their data using time-shifted and cherry-picked dates to wildly inflate a non-existent performance history.

[Morat20]

Diversified 401k, 16% of my salary up to the cap. I try to keep company stock below 15% (company match is in stock). All passively managed. The bulk is a target date retirement fund, the rest is index funds and a large-cap and small-cap company funds.

I check it quarterly to make sure the percentages haven't gotten all out of whack (mostly to trim company stock back every few years) and ignore it otherwise.

I've been doing this since I was...21 or 22? Anyways, it tends to make more money a year than I actually put in, so it's hit self-sustaining pretty nicely.

Other than that -- I have a kid (who is 18 and thus his mistakes are aggravating AND expensive), and student loans and shit. Like I have money for investment. When I get that bullshit 6.8% student loans for my wife's master's degree paid off, then maybe.

Admittedly, as a hobby I play around with day-trading futures using machine learners. But only, you know, simulations Because I'm not exactly the risk-taking sort and day trading futures is a good way to go so freaking broke even a loan shark would take pity on you.

[angry.bob]

What's your strategy for 2015? Day trading? Dump it all in S&P 500 and don't look back? Buy gold bullion?

I only have the stuff my Great Uncle bought. It's all utilities along the Northeast Coast, oil companies, and and a bunch of other similar stuff like distilling companies. Most of it pays dividends and does okay. I don't really pay any attention to the details and I don't particularly care to. If I did I'm pretty certain I'd fuck it all up and let some dickass trader talk me into something stupid so he could get a bunch of commissions. My Grandpa said that his strategy was to invest in stuff people absolutely had to have no matter what else was going on and that stuff you had to sell to make money off of was no good because you had to kill the goose to get the egg.

In all honesty, if you aren't already wealthy with and from stocks, forget it at this point. The system is so fucked and rigged now and designed to take your money and give it to rich people. So I guess I would suggest you sit on your pile of money in a corner until you get pissed enough to start killing our capitalist and executive classes.

[Samwise]

So I guess I would suggest you sit on your pile of money in a corner until you get pissed enough to start killing our capitalist and executive classes.

And here I've been thinking I was crazy.  Thanks for the validation.

 

I have a 401k that I contribute to regularly and periodically reshuffle it according to the latest and greatest strategy from our investment advisor at work, but on some level I don't believe that money is real since I know a big chunk of it could evaporate in an instant.  My main retirement plan is to pay off my house.  If you can live rent-free in the Bay Area you've pretty much got it made.

[Teleku]

Been piling the maximum Im legally allowed to into the TSP (federal governments 401K).  Have that split between an account that invests it with the assumption you are retiring in 2040, and a straight stock index.  Both have done pretty good over the last two years.

Well, I should say that's how I normally keep things.  Currently transferred all of it into bonds till the Greece situation works out, just in case they fail to make an agreement, Greece does something drastic, and the stock market decides this is the end of the world (as it seems to periodically do).  I'll move it back into stocks once we are past that, heh.

[Shannow]

I would be lying if I said that some of us who exist in the same competitive space as F-Squared and Good Harbor aren't watching their troubles with some amusement.