patrick.net

FortWayneIndiana says

Thanks Rin, Why do you hold off on GE, just curious if I should be aware of something. I haven't paid too much attention to them lately.

I can't be too specific, since my job isn't that of financial advisor for the masses. Here's an article on them ...

https://investorplace.com/2018/11/no-light-end-turbine-ge-stock

Booger says

Invest it in divided paying stocks.

This has been my general strategy. I trust stocks that pay a dividend much more than other stocks.

The whole point of stock to begin with is to pay a return to shareholders.

CBOEtrader says

2019 $1 million in cash to invest. What's your plan?

Is someone going to be winning a legal suit in the near future?

Patrick says

This has been my general strategy. I trust stocks that pay a dividend much more than other stocks.

By a bucket of dividend stocks, or even better, a ETF filled with dividend stocks paying 4%, and you can retire on that million bucks, and never worry about the actual stock prices.

It would depend on my age and circumstance.

At my age, I would probably split it between some income funds and capital appreciation funds.

I would put some into Vanguard Tax Managed Capital Appreciation. I would put some into Primecap Odyssey funds for capital appreciation.

Some I would put into less tax efficient funds, such as Vanguard Wellington, Equity Income and Wellsley Income funds.

ThreeBays says

Micron is looking very cheap. It's been battered by China tensions, and currently trading at a ridiculous 2.55 P/E. They're also executing a $10B buyback, when the market cap is down to $34B, which will further reduce P/E.

SEMI in general has taken a massive hit. It may take a,couple years but it will roar back.

Seriously, given current valuation, buying 3months treasury bills will beat S&P if you look at the next 10 to 12 years with more than 95% probability. Don’t believe? Imagine your entry at the high valuation of year 2000 and see where you are in 2010 and 2012. Valuation has good forecasting capability. Go google Russ Napier and John Hussman. If your “investment” time frame is less than 10 years, I do NOT know robust quantifiable approach other than saying you have to be a good trader. That is NOT wealth creation by “investing”. That is wealth “transfer” from suckers and you have to have the skill to make sure you are NOT the sucker. That is gambling skills. Know what you are doing and be honest. I am NOT against dividend stocks. All I am saying is that the first parameter you look at for investing at time frame of longer than 10 years is “valuation” and you allocate to value. Currently, all financial assets are 2X overvalued and treasury bills look attractive. If the politicians and central bankers force valuation to stay high by aggressively dumping money in assets, you might think you want to take a position and get some of their dumps. I will run away because I think that will be the end of the political and currency system like they all end across history.

FortWayneIndiana says

Safe bets like...Costco.... And of course I avoid Retail....

How do you avoid retail while betting on Costco?

curious2 says

FortWayneIndiana says

Safe bets like...Costco.... And of course I avoid Retail....

How do you avoid retail while betting on Costco?

Consumer staples is better than luxuries at this stage of the market, IMO. Similar logic w tech vs non-tech stocks.


MrMagic says

CBOEtrader says

2019 $1 million in cash to invest. What's your plan?

Is someone going to be winning a legal suit in the near future?

Still in negotiations. Probably yes.

Noone suggests a 3 flat rental building as part of their preferred investments? Hey @E-man would assume youd think rental properties are a good idea. I am a little concerned about managing a property though :/

Have any of you heard of assisted living facilities? Opportunity: The demographic of people who need assisted living is exploding. Medicaid pays for 80% of seniors, so youd never not get paid. Medicaid pays the same amount regardless of location, meaning you could buy a 6 room queen Anne in small-town USA and rent each room for the same as-if you had a home in downtown Chicago.

I've had to learn about assisted living facilities to sell LTC insurance policies. Effectively assisted living facilities can be any private residence w as few as 3 rooms. as long as the home qualifies w Medicaid as an assisted living facility, Medicaid will pay anywhere from $2k to $4k for assisting each healthy senior. The hospice care is late stage assisted dying... totally different.

I recently spoke to a rich family friend in Dallas who invests heavily into RV parks (claims it HUGE). He likes the assisted living opportunity. He's trying to put together a assisted living resort investment opportunity. I'm considering it

MrMagic says

Patrick says

This has been my general strategy. I trust stocks that pay a dividend much more than other stocks.

By a bucket of dividend stocks, or even better, a ETF filled with dividend stocks paying 4%, and you can retire on that million bucks, and never worry about the actual stock prices.

You plan on retiring on ~ 40K?

Booger says

MrMagic says

Patrick says

This has been my general strategy. I trust stocks that pay a dividend much more than other stocks.

By a bucket of dividend stocks, or even better, a ETF filled with dividend stocks paying 4%, and you can retire on that million bucks, and never worry about the actual stock prices.

You plan on retiring on ~ 40K?

W our digital econony, there are locations like deep east texas that were decimated by factories leaving where you can buy a $300k lakefront home.

Could semi retire w part time digital work plus that $40k/yr. $60k/yr would be more than enough... this assumes you want to live in the boonies and drive a 15 year old truck the rest of your life though.

W our digital econony, there are locations like deep east Texas that were decimated by factories leaving where you can buy a $300k lakefront home.

This concept has not caught on as fast as I thought it would. I was thinking that beautiful remote land like a Blue Ridge mountains homestead would become more in demand since telecommuting removes the need to be physically at work. Great if you like boating, fishing, hiking and other outdoor activities, not so good if you like "fine" dining and the opera. Even so, with uncrowded roads, only about an hour and a half drive to get to a city with such amenities.

HeadSet says

I was thinking that beautiful remote land like a Blue Ridge mountains homestead

Exactly. I went to W&L in Lexington. Was looking at plots of Blue Ridge acres yesterday. Lots of options for beautiful mountain homes, even river access homes for $300k in that area. For $500k you could get a palace.

Unless you are a WLU or UVA professor, there is no high paying job for 200 miles in any direction from there. You have to go all the way to DC for a decent job, which is madness compared to the tranquility of the mountains.

DC may be my least favorite big city in US. It's a terrible cesspool of pretention, crime, and traffic.

Unless you are a WLU or UVA professor, there is no high paying job for 200 miles

That is why I wrote "telecommute." That is, you do not have to go to a physical workplace. My wife's best friend from high school is living in a gorgeous home in the Shenandoah Valley near Waynesboro and "VPNs" in to a headquarters in Texas. She manages several of her employer's remote sites, all from an office in her home. The mountain views while dining on her back patio are awesome. This girl is also very urban, and has found plenty of excellent dining, museums, shows, and activities in the surrounding towns. Even so, Richmond is 1.5 hours away, and DC is a easy day trip at 3 hours.

Richmond and Charlottesville are both lovely college towns! Blacksburg and Roanoke lessor so.

I would personally stay at least 50 miles away from Northern VA urban DC cesspool.

FortWayneIndiana says

Safe bets like ... GE

LOL.

CBOEtrader says

Richmond and Charlottesville are both lovely college towns! Blacksburg and Roanoke lessor so.

I would personally stay at least 50 miles away from Northern VA urban DC cesspool.

Richmond is a full fledged city, with a downtown full of skyscrapers and related city amenities. Ever been to one of the Drive Inn Movies that still exist in the area? Lots of fun taking the kid to Hull Drive Inn in Harrisonburg, the drive in in Moneta. and one in Goochland. Of course, had fun with friends and dates at the drive-in when I was in high school. Kids today are missing out.

It’s my only exception, their stores are packed always.

I do know it’s a contradiction
curious2 says

FortWayneIndiana says

Safe bets like...Costco.... And of course I avoid Retail....

How do you avoid retail while betting on Costco?

Booger says

You plan on retiring on ~ 40K?

Add in any Social Security and any pensions and any other retirement savings, it's possible.

The average retiree spends around $46K a year.

CBOEtrader says

Noone suggests a 3 flat rental building as part of their preferred investments?

That actually one idea of mine. Buy single family rentals, and instead of renting to ONE family, rent it to a group of older women. This way you get multiple checks each month, and if one sticks you, you have a few other checks coming in. Plus, older women are a little bit more stable in their lives.

CBOEtrader says

Have any of you heard of assisted living facilities? Opportunity: The demographic of people who need assisted living is exploding. Medicaid pays for 80% of seniors, so youd never not get paid. Medicaid pays the same amount regardless of location, meaning you could buy a 6 room queen Anne in small-town USA and rent each room for the same as-if you had a home in downtown Chicago.

Actually another idea of mine. I spent a ton of time in those facilities when I was working.

But here's a different spin on that idea. Baby boomers are broke, with hardly any retirement savings. Any retirement money they have, they will blow through in their first few years. At that point, all they'll have is their S.S. checks. So where will they live, just based on that amount?

Solution: Senior Barracks. Set up a barracks situation, just like the military. You can have mess lines and other structure just like the military. You can schedule a Medicare physician to come in once a week for medical care. The residents sign over their S.S. checks and you provide all the necessities.

Where else are they going to live on $1300/month?

FortWayneIndiana says

Rin says

FortWayneIndiana says

Safe bets like PG, Costco, GE, ATT, CocaCola. There's dividents and they make a lot of money.

I'd hold off on GE but keep the others.

Thanks Rin, Why do you hold off on GE, just curious if I should be aware of something. I haven't paid too much attention to them lately.

GE is a hedge fund that masquerades an an appliance company. They've been an awful performer for the past decade.

MrMagic says

Patrick says

This has been my general strategy. I trust stocks that pay a dividend much more than other stocks.

By a bucket of dividend stocks, or even better, a ETF filled with dividend stocks paying 4%, and you can retire on that million bucks, and never worry about the actual stock prices.

That is, unless your dividend stocks lose 4% (or even 3% (or even 2.5%)) of their inflation-adjusted face value per year while you're drawing that dividend.

You can buy stocks that pay 10% 12% even 15% dividend, but that's because they're winding down in face value and basically being sold for parts. The trick is to find the sweet spot between good dividends and strong fundamentals that portend stability or even growth in the actual value. If the face value of the stock isn't averaging +2% per year, your stock isn't even beating inflation.

cmdrdataleak says

That is, unless your dividend stocks lose 4% (or even 3% (or even 2.5%)) of their inflation-adjusted face value per year while you're drawing that dividend.

Doesn't matter what the face value of the stock is, as long as the dividend continues, unless you have to sell it. Many of the big name stocks held their dividends in the last downturn, even when the stock prices fell 30%.

cmdrdataleak says

You can buy stocks that pay 10% 12% even 15% dividend, but that's because they're winding down in face value and basically being sold for parts. The trick is to find the sweet spot between good dividends and strong fundamentals that portend stability or even growth in the actual value.

That's more gambling, then anything. I used the 4% amount, as many financial advisors use the 4% drawdown model when pulling retirement funds, if you want preserve the base amount. Historically 4% was a safe number based on long term market trends.

cmdrdataleak says

If the face value of the stock isn't averaging +2% per year, your stock isn't even beating inflation.

Like I said, that doesn't matter if the dividends are providing the income you need and don't have to sell the stock.

CBOEtrader says

Could semi retire w part time digital work plus that $40k/yr. $60k/yr would be more than enough... this assumes you want to live in the boonies and drive a 15 year old truck the rest of your life though.

What's the point in retiring unless you can do it in Caligulan Splendor like Rin?

CBOEtrader says

Richmond and Charlottesville are both lovely college towns! Blacksburg and Roanoke lessor so.

I would personally stay at least 50 miles away from Northern VA urban DC cesspool.

It's actually getting kind of not uncommon for someone to work a northern VA job from Baltimore city by telecommuting 4 days a week and going into the office one day. Really not that bad if you can pick the day of the week to avoid wet roads and/or other traffic issues.

I'm confused. How much is a million dollars after a new Maserati, tons of blow, and a six month world tour of Rin's whorehouses?

CBOEtrader says

Have any of you heard of assisted living facilities? Opportunity: The demographic of people who need assisted living is exploding. Medicaid pays for 80% of seniors, so youd never not get paid. Medicaid pays the same amount regardless of location, meaning you could buy a 6 room queen Anne in small-town USA and rent each room for the same as-if you had a home in downtown Chicago.

I've had to learn about assisted living facilities to sell LTC insurance policies. Effectively assisted living facilities can be any private residence w as few as 3 rooms. as long as the home qualifies w Medicaid as an assisted living facility, Medicaid will pay anywhere from $2k to $4k for assisting each healthy senior. The hospice care is late stage assisted dying... totally different.

You might want to confirm that. First, a lot of Medicaid policies are state based, not federal like Medicare, so they aren't the same in every state. Plus, I've never seen Medicaid pay at a assisted living facility. All the assisted living places I went in, were all self pay, or long term insurance paid. The places that were paid by Medicaid were the skilled nursing facilities, where the people needed a lot more medical care, and were closer to $8K a month if you self paid.

Also, you might be confused, that claim of "pays 80% of seniors" sounds like the normal Medicare policy, not Medicaid. Medicare will pay for a short term stay in a skilled facility if someone needs short term rehab. Everything Medicare covers is only 80%, except for Part A in the hospital. Medicare does NOT pay for assisted living expenses.

But, I agree, these type of facilities will be in BIG demand, as the poor, fat Baby Boomers transition into old age.

MrMagic says

You might want to confirm that.

I am by no means an expert on how these facilities work. Would require a full research project to understand the opportunity.

MrMagic says

But, I agree, these type of facilities will be in BIG demand, as the poor, fat Baby Boomers transition into old age.

Gotta be a real estate opportunity in there somewhere. I particularly like businesses that rely on consumer choices w govt paying the bill :)

Yes we are discussing medicaid not Medicare. It is my understanding that 80% of seniors end life on Medicaid, and medicaid also pays for 80% of hospice care. Perhaps less in assisted living (50%?). The opportunity I'd like to invest I would be a real estate income producing business operating as a medically necessary facility for seniors who will most likely never live autonomously again.

The first stage of that process requires lite medical treatment and pays about half of that $8000 total you mentioned above. $8000 is for hospice, I think? I'm looking for answers if you know where to find them?

MrMagic says

Solution: Senior Barracks. Set up a barracks situation, just like the military. You can have mess lines and other structure just like the military. You can schedule a Medicare physician to come in once a week for medical care. The residents sign over their S.S. checks and you provide all the necessities.

Where else are they going to live on $1300/month?

Add a slow-mo drone fly-by w music and we could finance this. Rinse, get on it :)

We'll call it Patrick's Post-Retirement Paradise, where activities are pure joys like license plate craft time and cold calling for bill collectors.

CBOEtrader says

MrMagic says

Solution: Senior Barracks. Set up a barracks situation, just like the military. You can have mess lines and other structure just like the military. You can schedule a Medicare physician to come in once a week for medical care. The residents sign over their S.S. checks and you provide all the necessities.

Where else are they going to live on $1300/month?

Add a slow-mo drone fly-by w music and we could finance this. Rinse, get on it :)

I know it sounds like a strange concept, but I got the idea after talking to my son, who's the Director of Sales for a senior retirement community. He said they're seeing less and less of retirees who have the required financial assets to live in the community.... So I got thinking...

The facts are, there will be MILLIONS of retirees in their 70's who are active, but broke.... Where are they going to live?? In their kids basements?? Oh, wait, their kids are still living in their basements, the kids don't own houses.

Maybe instead of barracks, how about dorms, just like college? These retirees, without major medical issues, will need to live somewhere on their S.S. checks..

Or, just go long refrigerator boxes...

CBOEtrader says

I particularly like businesses that rely on consumer choices w govt paying the bill :)

That's what I did before retiring. Provided custom medical equipment that was paid primarily by Medicare and Medicaid.... Guaranteed money!

In fact, I don't remember much of the last financial meltdown, as it didn't affect us. Wifey and I were both working in the medical space in 2008, so our incomes and jobs were affected. The 401ks took a hit, but since came back, but since our income was indirectly paid by the government, there was no issues.

CBOEtrader says

It is my understanding that 80% of seniors end life on Medicaid,

It could be either one. Medicaid requires you to have zero financial assets, and does a look back over many years, so if they hadn't depleted all their assets, they would still be on Medicare, and Medicare would pay for hospice.

MrMagic says

Medicaid requires you to have zero financial assets, and does a look back over many years,

A LTC policy allows you to spend down the policy money rather than your own assets. However, yes the spend down into expensive end of life assisted care is the point. 80% of seniors (and there are millions) are requiring anywhere from assisted living to hospice before they die. If medically necessary, medicaid pays for it after the senior pays down their own assets.

By end of life 60%? of seniors have paid down their assets and are living recieving medical care from medicaid.

This money flows to private care taking facilities. How do we place ourselves downline of this cashflow?

MrMagic says

He said they're seeing less and less of retirees who have the required financial assets to live in the community....

How do you become the section 8 provider? Legit question.

If I cant find ^^ then I'm going w trailer park management company. Saw a documentary on a FL trailer park specializing in renting to ex-sex-convicts. Because they had no choice they were packing 2 of these guys into a trailer for $1200/month per trailer. Amazing.

Because they had no choice they were packing 2 of these guys into a trailer for $1200/month per trailer. Amazing.

I know of a guy in Hampton has a crappy little single story 4 bedroom house with 10x10 bedrooms that he rents out for $200/week per room. Same situation, sex offenders and other cons that have no choice.

https://investingnews.com/daily/life-science-investing/genetics-investing/anti-aging-companies-invest/

CBOEtrader says

MrMagic says

Medicaid requires you to have zero financial assets, and does a look back over many years,

A LTC policy allows you to spend down the policy money rather than your own assets. However, yes the spend down into expensive end of life assisted care is the point. 80% of seniors (and there are millions) are requiring anywhere from assisted living to hospice before they die. If medically necessary, medicaid pays for it after the senior pays down their own assets.

By end of life 60%? of seniors have paid down their assets and are living recieving medical care from medicaid.

This money flows to private care taking facilities. How do we place ourselves downline of this cashflow?

We need to invent an ETF for this if none exists. Perhaps Rin can help.

CBOEtrader says

By end of life 60%? of seniors have paid down their assets and are living recieving medical care from medicaid.

This money flows to private care taking facilities. How do we place ourselves downline of this cashflow?

Actually, I went looking because I thought that 60% sounded high for Medicaid. This is what I found:

..."Over the final year, total medical spending is $59,100. Of this total, $42,100, or 71%, is covered by Medicare,
while $5,900, or 10%, is covered by Medicaid, and $1,040 is covered by other government programs. "



Looks like Medicare pays the most, not Medicaid.




and this shows where it's being spent.

Here's the link, lots of data for Senior healthcare.

https://www.nber.org/papers/w21270.pdf

CBOEtrader says

ex-sex-convicts. Because they had no choice they were packing 2 of these guys into a trailer

Man, I cringe at what the beer summit must be in these. It's a living!!

I'm honestly surprised there aren't more takers for a remote cheap 3/2 house and 15 year old pickup. I'd actually go all in for pre-smog era '72 Buick Electra 225 and do oil changes with Wesson, replace the belts with pantyhose twisted in a rope, and remove the deck lid for hauling. What an easy life.