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ER Rocks!
Old 12-23-2004, 08:21 AM   #1
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ER Rocks!

Hi All! Wow...I just found this board and I've been reading for hours. I've owned my own biz for 20 years...last year my Mom got ill and I had to take time off to help her out. I basically told Xhubby...take the biz...it's yours! I was burnt out and no longer enjoyed what I did (publishing a magazine) I moved my Mom to assisted living since she could no longer care for herself (she's now minutes away from me)....my Mom and I never really discussed her finances (my Dad passed away a long time ago) The 1st thing I did after I got her settled was spend time in NY....go thru all her papers, etc and put her apt up for sale. I sold her apt the day after I turned 50. It was a life changing event! I spent months sorting things out....stocks, bonds, etc. I researched every stock and subscribed to the WSJ. My Mom is unable to make any financial decisions due to Dementia and as an only child I took full responsibility. I LOVE the market! Basically I paid off my mortgage, paid off my credit cards, take care of all her expenses, see her a few times a week. I read the WSJ, local paper and NYTimes every morning. I work out w/ a trainer, help Xhubby w/ the biz (small things) and I LOVE ER! Dealing w/ ad layouts pales in comparision to learning about the stock market and investing, etc. My home has appreciated a great deal since I bought it 10 years ago. I live on the water ....the bottom line is...I pray I never HAVE to go back to work. I was very successful, my Mom never worked and I am having the time of my life! I look forward to reading all the posts here and getting to know you...I hope I'm on the right track here! Annie
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Re: ER Rocks!
Old 12-23-2004, 09:08 AM   #2
 
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Re: ER Rocks!

Annie,
You'll find that most posters here don't invest in stocks, but in mutual funds, mostly low-cost, tax-efficient index mutual funds. Also, they control their spending so it's around 4 to 5 percent of their total next egg per year. You might also want to buy "Mutual Funds for Dummies", a good book despite the name. Or "The lazy person's guide to investing". Some good web sites are www.coffeehouseinvestor.com or www.diehards.org

Good luck!
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Re: ER Rocks!
Old 12-23-2004, 09:26 AM   #3
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Re: ER Rocks!

Thanks Guest for the links! Happy Holidays! Annie
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Re: ER Rocks!
Old 12-26-2004, 10:04 AM   #4
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Re: ER Rocks!

Annie-- I am a new poster on this Board too, although I have been lurking here for some time. You will find a lot of useful information and encouragement here. The basic message is ER can be done. I like it because its practical advice from real people not some sales pitch from a broker or worse. Sounds like you are really enjoying your new life. Good luck as you go on from here. Hope you keep sharing your experiences and obvious enthusiasm.

Donner
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Re: ER Rocks!
Old 01-04-2005, 10:14 AM   #5
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Re: ER Rocks!

Hi Donner! Nice to meet you! Hope everyone had a Happy New Year! Well....I started the day by buying a small stock that seems to be moving up.....the market hasn't been kind yesterday and today. This is all new to me but I CANNOT beleive that Amazon had a whale of a Xmas and Smith Barney downgraded the stock...what's up w/ that?? Oh well....weather is Sunny Florida is.....cloudy....and I'm sitting outside reading a good book. Hope everyone is enjoying the day! Annie
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Re: ER Rocks!
Old 01-04-2005, 04:06 PM   #6
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Re: ER Rocks!

Hi Annie-- I had a very nice holiday this year. Learned that I am going to be a grandpa in July! May move up the retirement date.

Don't know much about the specifics of Amazon. Did use them for some Christmas shopping though. Very efficient.

You need to be careful about differentiating between investing for the long term and doing a little day trading for fun. This Board can give you some good ideas about investing for the long term. You need to develop a good allocation plan for your own age and life circumstance and stick with it. A good low cost fund family, such as Vanguard, can provide some good options. You might want to call them and talk to one of their advisers.

As far as the day trading goes, I have never done any of that. You have got to watch your trading costs in and out which kills most day traders. Also, when you go into a trade you need to set out a specific goal, and when you get there liquidate the position and take your profits. Also important to set in advance how much of a loss you are willing to accept -- and when you hit that loss get out without any regret. Be disciplined about that. Be sure to set stop loss points under your position. Day traders take their profits in small bits-- they don't try to hit home runs but are happy going 3 for 4 and hitting a bunch of singles every day.

Good luck and I hope your Amazon works out well.
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Re: ER Rocks!
Old 01-04-2005, 07:02 PM   #7
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Re: ER Rocks!

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As far as the day trading goes, I have never done any of that. *You have got to watch your trading costs in and out which kills most day traders. *Also, when you go into a trade you need to set out a specific goal, and when you get there liquidate the position and take your profits. *Also important to set in advance how much of a loss you are willing to accept -- and when you hit that loss get out without any regret. *Be disciplined about that. *Be sure to set stop loss points under your position. *Day traders take their profits in small bits-- they don't try to hit home runs but are happy going 3 for 4 and hitting a bunch of singles every day.
For a guy who admits he has never done any daytrading, you sure give a lot of advice on it.

Mikey
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Re: ER Rocks!
Old 01-05-2005, 02:47 PM   #8
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Re: ER Rocks!

Just the basics, mikey, just the basics.

I would describe my reply to Annie as more of a cautionary note than investment advice.

And while what I cautioned is pretty plain vanilla and generic to all short term trading, I think it is especially appropriate with respect to Amazon. Here is a company that has a $17 billion market cap. Its chart over the past year looks like a yo-yo on steroids. It started last year at $51.90 per share on Jan 2 and popped to $57.18 per share on Jan 22. It meandered all over the place for the rest of the year. Had a nice ride from $54.40 per share on June 30, 2004 to $38.92 per share on July 30, 2004. It is presently trading at $41.70 per share.

Fundamentals on this company are interesting: (annual as of Sep 30, 2004)

Total Revenue $5.3 billion
Cost of Revenue 4.0 billion
Gross profit 1.3 billion
Operating expenses 986.5 million
Operating income 276 million
Earnings Before
Interest and Taxes 165.7 million
Interest 129.9 million
Taxes 0
Net Income Applicable to Common Shares $35.2 million.
(this is an improvement from a net loss of $145.7 million in 2003 and $526
million in 2002)

Balance sheet is also kinda interesting:

Total Assets $2.1 billion
Total Liabilities 2.8 billion
Stockholder Equity minus $721 million
Net Tangible Assets minus $858 millon

This is a company with 408 million shares outstanding. 27% are held by insiders and 62% by institutions. Those 363 million shares arent going anywhere. Of the remaining 45 million shares outstanding 29 million shares are held short and 16 million shares are held long. 9 million shares trade every day. Interesting, no?

This is a company that has burned all its seed corn and has borrowed $1.8 billion to keep the company going and pay the bills.

Morningstar gives it one star and puts a fair value of $30 per share on Amazon. They suggest buying at $23 and selling at $37.60. But they also think it has a wide economic moat (no competitors, yet)

When you buy into this $17 billion asset you are not buying Amazon the business but Amazon the dream.

So , yeah, mikey, I think Annie should consider putting a stop under this puppy at $41.70 per share. What do you think?

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Re: ER Rocks!
Old 01-05-2005, 04:07 PM   #9
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Re: ER Rocks!

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So , yeah, mikey, I think Annie should consider putting a stop under this puppy at $41.70 per share. *What do you think?
I think it is beyond my circle of competence, and thus none of my business.
Mikey
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Re: ER Rocks!
Old 01-13-2005, 02:51 PM   #10
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Re: ER Rocks!

Hi All! I appreciate the advice and CONGRATS on being a Grandpa!!!! Since I too did alot of Xmas shopping on Amazon and just bought a book today from Amazon I purchased the stock when I saw it go down to $38 but I am holding on....I am trying to pick stocks because I beleive in the Company....hey....LOL...we'll see how I'm doing in 1 year....I'm 50 so I feel as if time is on my side...my Mom loved the stock market and I guess it's contagious! Annie
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Re: ER Rocks!
Old 01-13-2005, 03:42 PM   #11
 
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Re: ER Rocks!

You're 50 and "feel as if time is on your side"?
I wish you good luck. I truly do.

JG
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"The future ain't what it used to be."- Yogi Berra
Old 01-14-2005, 07:57 AM   #12
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"The future ain't what it used to be."- Yogi Berra

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You're 50 and "feel as if time is on your side"?
John, I'm reading "How Not To Go Broke at 102" by Adriane Berg. I don't think she's up there with Bernstein or Porter but at least she's above Suze Ormon. Despite her media frenzy, the woman does some research:

Of those who were 65 in 1940, only 7% lived past 90.
Of those who were 65 in 1960, 14% lived past 90.
Of those alive in 2004, at least half of all Americans will live well past 85. Gen X will be middle-aged in a world where one of every two people will be a boomer over 85.

Since 1960, the number of Americans over the age of 85 has risen by 274%.

Since 1980 the number of American centenarians has doubled and is expected to double again by 2010.

According to the human life databases at http://www.demogr.mpg.de/, one-third of children born this year in developed countries will live past 100.

One of my life goals is to make my college's "10 Oldest Alumni" list. The current group, among them survivors of WWII, Korea, & Vietnam, are all over 100 years old. When they were born, their average life expectancy was 47.

Here's an actuarial quirk-- for every year you live, your remaining life expectancy rises by a year plus a fraction. So every day buys you another day plus a bit more.

A Swedish study of over 700 sets of twins' lifespands concluded that genetics is only one-third of longevity. Environment & attitude make up the rest.

At age 44 I still find myself gravitating toward the 20-something groups at social gatherings. (Must be a family problem-- my wife claims that she's considering several offers to trade me in on a couple of 22-year-olds.) Most of my military working contemporaries strike me as "older" than me. Physically I feel 25, which is ironic considering what poor physical condition I was actually in at that age. Emotionally I'm not much more mature, although mentally I'm probably closest to my chronological age.

So keep at your diet, and you might need to save up some more envelopes...
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Re: "The future ain't what it used to be."- Yogi B
Old 01-14-2005, 08:32 AM   #13
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Re: "The future ain't what it used to be."- Yogi B

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...but at least she's above Suze Ormon.
That's not saying much.
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Re: ER Rocks!
Old 01-14-2005, 12:48 PM   #14
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Re: ER Rocks!

Nords, it's not written in stone that most of us are going to make 90.

Mrs. Zipper works at a cancer centre. She sees people who have followed all the rules everyday.

Take life one day at a time.
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Re: ER Rocks!
Old 01-14-2005, 03:38 PM   #15
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Re: ER Rocks!

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What has changed is government safety regulations for workers and nutrition improvement, infant mortality, so as a average we are living longer. However they cast a lot of doubt of this trend continuing. Mostly because we just plain wear out at 90.
Maybe the single biggest factor is improved sanitation, then vaccines for children. It is hard to remember that cholera, malaria and sometimes even yellow fever were not uncommon in the US a hundred years ago.

Lots of eastern and miswestern cities have suburbs named Mount Healthy or some such. Think of Bel Air!

Everybody with the wherewithal wanted to get out of the low-lying parts of town, where all the mosquitos were.

Still, I think Nords has a good point, and I think JG was a bit off base in his post. We all know that anything can happen, but I don't see any reason to keep that foremost in our thoughts. Plenty of people do live a very long time, in reasonably good health. Why not be positive, and look forward to that?

Mikey
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Re: ER Rocks!
Old 01-14-2005, 04:25 PM   #16
 
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Re: ER Rocks!

Quote:
Still, I think Nords has a good point, and I think JG was a bit off base in his post. We all know that anything can happen, but I don't see any reason to keep that foremost in our thoughts. Plenty of people do live a very long time, in reasonably good health. Why not be positive, and look forward to that?
Mikey,

I agree that we should all hope for a good, long life. I also believe that you should live everyday as if it's your last.

I have heard the stories of too many terminally ill people that actually stated that the 'death sentence' that they received was a blessing, because it taught them how to live.

I also have some fishing friends of mine that can no longer do the things that they loved because of physical problems.

We spend 95% of our time on this forum with financial issues, even though every elder we have ever talked to has told us 'If you've got your health, you've got everthing'. No one seems to believe it until they lose it

And we all will someday
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Re: ER Rocks!
Old 01-15-2005, 03:05 AM   #17
 
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Re: ER Rocks!

Just a quickie for MIkey, mostly. I was sincere in my good
wishes, but time is only your friend in investing.
Otherwise, each day brings you one day closer to your
demise. That's a law congress can't change. Now, I'm
not suggesting we all stay inside and wait to depart this life. Quite the contrary. However, the list of my friends, neighbors, contemporaries, business associates
and relatives who checked out before "50" or close to it
is quite long. Cut-Throat has a very solid grasp of this
and is living his life accordingly. I suggest we should all try to follow his example. For the vast majority of people, by age 50 their healthiest time of life is past.
So, no, I don't think a 50 year old has
"time on their side" at all, with the one exception I
mentioned.

JG
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Re: ER Rocks!
Old 01-15-2005, 02:36 PM   #18
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Re: ER Rocks!

Quote:

We spend 95% of our time on this forum with financial issues, even though every elder we have ever talked to has told us 'If you've got your health, you've got everthing'. No one seems to believe it until they lose it

And we all will someday
Bingo! C-T,

Years ago the old man told me, "Kid, you just don't get it. When you're retired, money will be the least of your problems".

I believe he was right but I still don't get it. Gotta live it I guess.

BUM
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Re: ER Rocks!
Old 01-20-2005, 01:37 PM   #19
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Re: ER Rocks!

My father worked till 62 and them retired. Told me that if he had know he would enjoy retirement so much, he would have retired sooner. I am on track to be there at 59. Sure, some have done it much sooner on much less $$ but I will be in much better $ shape then and will still leave some stock options on the table.
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Re: ER Rocks!
Old 12-07-2005, 06:22 AM   #20
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Re: ER Rocks!

Hi All! I am the OP....w/ a 1 year update! LOL! I had to give up the NY Times and WSJ because I just didn't have time to read everything...it started to feel like work : I'd been looking online for a couple of years at investment/retirement/vacation home properties. I live in So Fl and I know quite a few people my age (early 50's) 51 to be exact...who bought in the mountains of NC and LOVE it. We have had 7 hurricanes in the past 2 summers and the idea of a relaxing place to get away to in the country sounded awfully good! This past spring I contacted a Realtor in the area and flew up to look at properties...OMG! I found a fixer upper on almost 3 acres that I fell in love w/. LSS....I closed on the property in Oct. It almost went into foreclosure....as a matter of fact the previous owner owed quite a bit on the property and w/ the repairs etc we ended up going to their bank and the bank renegotiated the payoff...thank goodness banks do not want to be in RE. I am in the process of working w/ a fantastic Contractor who my Realtor referred me to and the house is over 100 years old and needs a new foundation...done...I bought every back issue of This Old House on Ebay.....every book I could find on restoring old houses on Amazon (which by the way...LOL..I sold at $42) and I am having the time of my life! I know people do this for a living but....for me it is a passion! I still follow the stock market...I am busier than ever and....ER still rocks!
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