Fagan Associates Archive for April, 2011

No one should get kicked when they’re down (though they might decidedly deserve to be) and so we won’t kick Lenn Dykstra when he’s down - nor we will we remind you of the compliments and trust thrown his way by uber promoter Jim Cramer on CNBC. We wil point to our article of July 9th, 2009 so you can read what we wrote some 20 months ago. (commentary entitled “Nails”)

We are big internet researchers. We love to read and contemplate research material relating to stocks. Some of our favorite moments come when we “bad mouth” some inane comment on CNBC. In short, we tend to overdose the financial business and that can be a worrisome thing.
We are however practical and some of our best ideas and philosophies have come from novels, friends, parents and totally business-less areas.
Life can be like that too. Never ignore the potential for happiness, a friendship or a fun day/evening wherever you may find them. Both of us have off beat hobbies that might draw a snicker or two from MACHO friends but those hobbies can provide great sources of relaxation and enjoyment.
Similarly, our philosophies for clients come from unusual sources.
One of Dennis’ favorites is from a garden journal which advises diversifying  blooming seasons on flowers and plants so as to always have something in bloom. The thought is simple for a garden but at times difficult to implement for investors as we tend to be rewarded by the most timely of movers.
We enjoy a diverse stream of information which provides philosphies that at times are more practical than many other financial pundits. For that reason, at times when we are discussing topics that are seemingly unrelated to the markets we find philosophies as helpful in investing as they are in life.

The stock market is kind of like the weather in London.  The outlook changes constantly.  Just a couple of days ago investors were flocking to the Consumer NonDurables and Health Care.  Now, with solid earnings reports from Intel and rail giant, CSX, they are now moving back toward companies that are economically sensitive like Technology, Industrials and Basic Materials. 

We think the latter move has more staying power and would not use a day like today when these sectors are strong but rather one in which they are out of favor.  We are certainly not saying that the U.S. Economy is humming on all cylinders, but rather that Treasury and the Federal Reserve is pursuing dollar policy that will make U.S. Companies more competitive abroad, especially in the emerging markets like China, Inda and Brazil.

Never ever admit it.
Never think it could be possible.
But - - — in investing it pays to consider that you might be wrong. Infintesimal as that possiblity might be, it is there. If only some of our investment gurus would take that into account when making proclamations of truth not predictions!!
“Interest rates will go up”- “The stock market will go down” - these “FACTS” have left many an investor waiting for these occurences some two years after hearing them and adjusting their investments accordingly.
Our advice is to make HUGE investment changes slowly and incrementally. These incremental changes won’t leave you on the outside looking in at market advances (both stock and bond)