Saying Goodbye to Mom
"You get recessions, you have stock market declines. If you don't understand that's going to happen, then you're not ready, you won't do well in the markets."
- Peter Lynch
I made my buys for the year on December 28, 2017, see the new portfolio here (Click Here).
For the last 12 days I’ve struggled with a dilemma, specifically, what to do with this blog. On August 3rd, my mom, Ally Lou Baker passed away at the age of 89.
My apologies for not writing anything over this period of time and I’ll try not to turn this into a eulogy as our focus here is on investing.
The blog is called Mother’s Little Helper because it was about how mom and I worked together to resolve her issues with investing, investment advisers and trying to make sure she didn’t outlive her savings. Outliving ones savings is unfortunately not a unique experience and most of my readers have a story to relate about this fear. While mom experienced some major setbacks with her savings, the two of us worked together, got her to ‘Stay Invested’ and managed to build a portfolio that did in fact provide for her to the end. More importantly mom found comfort in knowing that she was invested and that she no longer feared a downturn in the market. Over time she saw the opportunity provided by declines in stock prices to buy good companies on sale.
"Wide diversification is only required when investors do not understand what they are doing."
-Warren Buffett
I’m still undecided about what will become of this blog, maybe giving time a chance to propose new ideas will be the best course of action. For now I’ll keep updating the portfolio performance and occasionally write something about the portfolio and the markets. Maybe it’s time to end the blog, maybe it should take on a new life and pivot in a different direction, maybe it should continue exactly as it is; I would appreciate any input my readers wish to send me.
Our family all gathered in Montana for an early 90th birthday celebration with mom. She was happy, healthy and as vibrant as ever. She was surrounded by her children and their spouses, grandchildren, great grandchildren and a couple of very close family friends who are in fact family to us. She enjoyed her favorite meal in the historic hotel her grandfather once owned and where her father was born. We toasted her and extolled all the love that we all have for her and all she’s done for every one of us. The speeches were wonderfully sincere and from the heart. True to form, mom didn’t waste time thanking us all for the accolades, she instead redirected us all to recognize the talent that existed in that room. Mom was utterly amazed at what we had all become and that we needed to acknowledge that in that room, that day, were accomplished writers, actors, teachers, artists, exceptional students, gifted children and business people, all exceptional people. Mom always looked to the future and encouraged us to persist at achieving our dreams.
Four days later she left us, I like to think that like everything else in her life, she left this life on her own terms.
I want to thank my mother for letting me tell her story in the hopes that other people struggling with the same issues will come to see that it is possible to have the resources we all need and that we can do it on our own with great success. The greatest take away from the experience of the blog is that we must start investing very early. Parents should start buying S&P 500 index funds when their children are born and continue contributing as they grow. When those children begin earning money they also need to learn that they can't spend it all, a portion has to go to that investment account and they need to keep investing diligently over the rest of their lives.
If just one person is better off for following her story and the portfolios we created online, than this blog will have been a success. Mom once said to me,
“If people would put half as much time into their investments
as they do to posting on Facebook about nonsense and things they can’t change,
the whole country would be much richer, happier and better off.”
-Ally Lou Baker
October 21, 1928 - August 3, 2018
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I am attempting to keep track of my calls and predictions by logging them at the bottom of every post.
Bond prices will decline as a result of rising rates and a Dollar Shortage.
Invest in China stocks. NetEase, YY, JD, Baidu, Alibaba, mobile phone services and makers, and China BioTech
Invest in Whirlpool (see Whirlpool caveats above), Kohl’s, Costco Wholesale, Home Depot, Dollar General and Casey’s, Ingersoll-Rand, Illinois Tool works, Paccar, Honeywell, and DowDupont, PayPal, Square, Goldman Sachs, Citibank, Bank of America, JP Morgan, DBC, Apple, Microsoft and Caterpillar.
Goldman Sachs slides to around $210/share
Proctor & Gamble, Coca-Cola, Merck and Pfizer will go lower as rates rise.
The Chinese yuan will replace the dollar in international trade. Not this year, but it will happen in coming years.
The DOW will close the year with 9-10% gain.
The S&P 500 will close the year at 2900-3000.
The portfolio will generate about $2,065 in dividends.
M&A of drug companies will increase over the next 24 months.
The trade war will be short lived, some pivot will take place prior to November 2018 elections
Stay Invested,
Clay Baker
Disclosure: I am personally invested long in some or all of these funds that appear in the Mother's Little Helper portfolio or manage these investments for my Mother's portfolio and may purchase or sell shares within the next 72 hours. I am also invested in other stocks and funds that do not appear in the MLH portfolio but may be mentioned or related to this article. It is not my intention to advise or encourage the purchase or sale of any security. Since I may on occasion discuss Bitcoin and other cryto currencies I disclose here that I personally own investments in the cryto-currencies listed here: AMZN, DBC, VTI, VWO, VEA, VIG, XLE, MUB, TBT, GLD, Bitcoin, LiteCoin
I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article. This article is not intended to offer investing advice, guarantee 100% accurate predictions, or to be interpreted as providing a personal recommendation.
