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My unlce was telling me yesterday that he is slowing selling and getting into a strong cash holding. Slowly selling and taking the profits and holding onto cash.

This morning I am driving in and hearing about the pending currency wars...

Anyone moving to cash?
 

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Holding my distribution paying REITs , sold my speculative stocks this morning , KLH and PDN (up 80% and 60% respectively) and am keeping the proceeds in cash for now.

I may get back in if they dip enough , otherwise I am happy to keep profit and secure in knowing I have some cash on the side.

Will invest the profits in REITs , and re-deploy the original capital if I see another bargain.

Equities have had quite a run lately , maybe too much , it's a little scary.

Lots of uncertainty out there right now.
 

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My unlce was telling me yesterday that he is slowing selling and getting into a strong cash holding. Slowly selling and taking the profits and holding onto cash.

This morning I am driving in and hearing about the pending currency wars...

Anyone moving to cash?
All currency wars are going to do is create inflation. In that environment, cash will be about the worst investment possible. Gold would be better, any other commodity next, and stocks that create real goods and services would be a 3rd bet.

All this is macro economic which means that most likely some other scenerio that we have not foreseen will play out and all of us will get the shaft. Makes you really look forward to getting up in the morning! lol.
 

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I was just watching CBC News midday and there is lots of minor bad news so far today. Seems Ireland is in bad shape after spending billions bailing out banks. They were also talking about China's possible efforts to slow down their economy, not good news coming out of the G20. TSX down 245 points and gold down $40 an ounce.

I personally like the idea of holding onto cash, but as eagle said above, if it gets devalued then that may not be good. Only response I have is that CDN currency holdings are certainly not as risky as some of the other foreign currencies. Just my opinion though, what do I know.

We can theorize all we want but at the end of the day we don't really have a lot of control or foresight into future happenings. This is what they mean when they talk about stock market risk.
 

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My suggestion is to not listen too closely to the news cycle. It's amazing how distorted a view of events it can give you. It's entertainment, but it's not really information.
 

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Discussion Starter #7
Well today would have been a good day for me to take profits...

Oh well.

About gold as a safe haven vs. currency. I always believed that I would want to get in to commodities if I had enough cash and was timed well enough. I know a guy who sells huge ships full of...peas. Makes a fortune and has never seen a pea, or a ship for that matter. He says, oil or metals can increase out put. Their stability is based on politics (and sure, some weather-related events) but food is not going to be done without. People will eat peas (or animals-whatever they are for) and if weather makes the yield (harvest) less, the price goes up. Can't eat gold...
 

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Much needed correction is hopefully underway here so you can finally add or buy. I don't know for sure but I think a much bigger correction is more likely to take place later in the first quarter of 2011 then now.
 

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Ah, there is nothing like a bad day or week to bring all of the market timers out of the woodwork.

As for we 'buy-and-holders', we just ride the rollercoaster through all of the ups and downs and hope that we end up landing on our feet!!!:cool:
 

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What correction? We are 2% off the 2 year high. I don't see this developing into a real correction, like the May one, but I won't mind if I'm wrong. Correction = opportunity.
 

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Much needed correction is hopefully underway here so you can finally add or buy. I don't know for sure but I think a much bigger correction is more likely to take place later in the first quarter of 2011 then now.
Agreed. I hadn't been buying for a couple of months...most prices seemed too high as the market was rising. Patiently waiting for a better time/prices.
 

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Some of the pundits say that the reduced Cisco outlook is a bellweather of the US market.

Soft set-top box outlook is bad for consumer spending.

Weak basic growth is bad for business spending. Although it is still a healthy growth forecast! Probably indicates how nervous investors are!
 

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I read were Cisco's problems, were the result of that company having a large portion of their sales in the "public sector" worldwide.

That is, they rely on goverments around the world for much of their sales, and as all govt's , it seems, are in debt up to their eyeballs, all of them will have to lower spending next few years, meaning Cisco revs will drop.

I was lucky enough to buy INTEL a few months ago, and yesterday, they announced a 15% raise in their dividend starting in jan 2011, and the stock made a nice move up yesterday, when the overall markets were tanking.
Blind luck never hurts.

As for selling and getting out, there are two trains of thought here.

I have never really belived in "market timing"....no one has ever shown an ability to do that correctly over any time frame.

As well, "selling" produces a capital event, so taxes may be due on gains, leaving less capital to work with when your "timing model" says you should buy back in. This, of course is not a problem in RRSP, RRIF, RESP, or TFSA.

Lastly, the major problem is that cash basically earns very little now....which is exactly what Bernacke and the FED want, trying to push investors further along the risk curve.

I have too much cash already, and as bonds and bond funds pay little, and , in my opinion , are way overpriced, which will lead to losses down the road if ANY sniff of inflation rears its ugly head.....Id rather hold onto my income producing equities, and watch those paymenst land in my accounts every month, or quarter.

In fact it may very well be LESS risky over the next few years to hold solid dividend stocks, that produce consistent earnings, rather than cash or bonds.

Of cousre thats just another in the long list of ideas out here in the great land of the Capital Markets, and its worth just about what you paid to read it.

Good luck to all
 

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isn't the best idea to just stay the course but have cash on hand to jump in if there is a downturn ... ?
In my opinion, yes. Tactical asset allocation is integral part of any viable long-term investment strategy.

The majority of DIY folks just repeat the "dont try to time the market" mantra without fully understanding all the implication of a bad timing.

Here is a rather small article on the subject:

http://www.evansonasset.com/index.cfm?Page=13

Here is the conclusion, for discussion:

ONCLUSION: Do not buy the "Stocks for the Long Run" hypothesis uncritically. It is based upon the presentation of very long-term annualized returns data (averaged to yearly returns arithmatically or geometrically), and may not reflect what a real investor will experience in the market over reasonable investment time frames in the future. It most definitely underemphasizes the pain and disappointing returns stock investors may suffer if they happen to enter the market at the wrong time. Wall Street and the money management industry have a vested interest in moving investors into stocks because they get paid more for buying and managing stock portfolios than for bond portfolios or cash. Wise investors should look at both sides of the risk/return picture and adjust their equity/fixed ratios accordingly.
 

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In that wonderful year which was 2008, as I watched equity investments plummet around the world, I was comforted by the fact that 40 percent of my portfolio was it bonds which cushioned the fall for me.

Now, as 2011 fast approaches, and the spectre of rising interest rates and hyper inflation rear their ugly heads, I am not so comforted by my 60/40 equities to bonds asset allocation.

In some ways, I am more concerned now than at any time in 2008 but my plan is to continue to stay the course and hope for the best.

If things don't work out, I will apply for a greeter's job at Walmart.:(:eek:
 

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Volatility is increasing in the market now, I'd like to see where we're going from here before putting more cash to work. Perhaps we'll be range bound and I can make some money off of that, or it'll keep going up from here.

Capitals gains for bonds now will be slim and yields are low. Very unattractive. I'd rather be in all cash than some of the other no risk alternatives. At least I'll be able to easily jump into the market or spend it on other things such as real estate easily. When I saw the Canada savings bonds advertised at the bank, I just laughed.
 

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I consider myself a "buy and hold" investor......but not a "blind" investor.

More a "buy and watch" investor.

It is not rocket science to realize that 'when' you buy is important....ask anybody who bought the market back in 2000 when the S&P was trading at a P/E of over 36!!

Many of the tech stocks were selling at P/E's of over 100! and higher,
many had NO earnings, with potential earnings slim to none.
Everyone was hoping to find the next Dell, etc., or if not, find a bigger fool to sell out to, than the fool they were, when buying.
There are plenty of fools,,,but alas, they too run out.

In any case there are always stocks that sell at fairly good valuations, using p/e, p/cf, historical div yield, d/e, 10 yr roe, and any number of other metrics.

Im not Warren Buffet, so I dont have his ability to see whach buys are better than others.

Personally, I like stocks with a good yield, low payout ratio, reasonable debt, good history of div increases, good roe, and a 10 yr record of stockholder equity increases.

There were plenty of these solid blue chippers in late 2008, and into 2009.
A "buy and hold" investor would have done very well loading up then, but it required much strength to buy into that abyss back then.

The pickings are fewer now,,but they are out there.
I have been patiently waiting for more to appear as prices drop a bit, and am confident that buying these types of stocks at reasonable prices will reward a buy and hold approach, but as always, only time will tell.

By the way , it seems much harder to find these types of companies here in Canada, than in the US and the rest of the world!!

Any ideas from you guys, and girls, at what Canadian stocks might qualify for further research under these guidelines??

I am looking at BCE at the moment.

thanks
 

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Sorry, but what 'spectre of hyperinflation'? Hyperinflation is 40% a month. We're currently clocking in at between 0.1 and 0.2% per month.
 
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