Model Portfolio cash horde put to use in Lt. Bonds and Gold; Stocks valuation remain sky high!

 Updated Monthly

AGGRESSIVE PORTFOLIO - ACTIVE ALLOCATION - 10/1/23

Active Allocation Bands (excluding cash) 0% to 50%

25% - Cash -Short Term Bond Index - VBIRX

50% -Gold- Global Capital Cycles Fund - VGPMX **

 25% -Lt. Bonds- Long Term Bond Index - VBLTX

 0% -Stocks- Total Stock Market Index - VTSAX

[See Disclaimer]

** Vanguard's Global Capital Cycles Fund maintains 25%+ in precious metal equities the remainder are domestic or international companies they believe will perform well during times of world wide stress or economic declines.  

 This blog site is not a registered financial advisor, broker or securities dealer and The Dividend Yield Investor is not responsible for what you do with your money.

This site strives for the highest standards of accuracy; however ERRORS AND OMISSIONS ARE ACCEPTED!

The Dividend Yield Investor is a blog site for entertainment and educational purposes ONLY.

The Dividend Yield Investor shall not be held liable for any loss and/or damages from the information herein.

Use this site at your own risk.

PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS.

Margin of Safety!

Central Concept of Investment for the purchase of Common Stocks.

"The danger to investors lies in concentrating their purchases in the upper levels of the market..."

Stocks compared to bonds:

Earnings Yield Coverage Ratio - [EYC Ratio]

Lump Sum any amount greater than yearly salary.

PE10  .........29.48
Bond Rate...5.59%

EYC Ratio = 1/PE10 x 100 x 1.1 / Bond Rate

1.75 plus: Safe for large lump sums & DCA

1.30 Plus: Safe for DCA

1.29 or less: Mid-Point - Hold stocks and purchase bonds.

1.00 or less: Sell stocks - Purchase Bonds

Current EYC Ratio: 0.67(rounded)

As of  10-1-23
Updated Monthly

PE10 as report by Multpl.com

Bond Rate is the rate as reported by

Vanguard Long-Term Investment-Grade Fund Investor Shares (VWESX)

DCA is Dollar Cost Averaging.

Lump Sum is any dollar amount greater than one year salary.

Over a ten-year period the typical excess of stock earnings power over bond interest may aggregate 4/3 of the price paid. This figure is sufficient to provide a very real margin of safety--which, under favorable conditions, will prevent or minimize a loss...If the purchases are made at the average level of the market over a span of years, the prices paid should carry with them assurance of an adequate margin of safety.  The danger to investors lies in concentrating their purchases in the upper levels of the market.....

Common Sense Investing:
The Papers of Benjamin Graham
Benjamin Graham

%
Stocks & Bonds

Allocation Formula

10-1-23
Updated Monthly

% Allocation = 100 x (Current PE10 – Avg. PE10 / 4)  /  (Avg.PE10 x 2 – Avg. PE10 / 2)]

Formula's answer determines bond allocation.

Current PE10.....29.48

Avg. PE10...........17.05

% Stock Allocation    1% (rounded)
% Bond Allocation   99% (rounded) 

Logic behind this approach:

--As the stock market becomes more expensive, a conservative investor's stock allocation should go down. The rationale recognizes the reduced expected future returns for stocks, and the increasing risk. 

--The formula acknowledges the increased likelihood of the market falling from current levels based on historical valuation levels and regression to the mean, rather than from volatility. Many agree this is the key to value investing.  

Please note there is controversy regarding the divisor (Avg. PE10).  The average since 1881 as reported by Multpl.com is 16.70.  However, Larry Swedroe and others believe that using a revised Shiller P/E mean of 19.6 , the number since 1960 ( a 53-year period), reflects more modern accounting procedures.

DYI adheres to the long view where over time the legacy (prior 1959) values will be absorbed into the average.  Also it can be said with just as much vigor the last 25 years corporate America has been noted for accounting irregularities.  So....If you use the higher or lower number, or average them, you'll be within the guide posts of value.

Please note:  I changed the formula when the Shiller PE10 is trading at it's mean - stocks and bonds will be at 50% - 50% representing Ben Graham's Defensive investor starting point; only deviating from that norm as valuations rise or fall.        

  

DYI

This blog site is not a registered financial advisor, broker or securities dealer and The Dividend Yield Investor is not responsible for what you do with your money.

This site strives for the highest standards of accuracy; however ERRORS AND OMISSIONS ARE ACCEPTED!

The Dividend Yield Investor is a blog site for entertainment and educational purposes ONLY.

The Dividend Yield Investor shall not be held liable for any loss and/or damages from the information herein.

Use this site at your own risk.

PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS.

The Formula.

A value based allocation strategy

February 19, 2010 by John Kingham

From High to Low - Since Year 2000

+ 544.4% Gold

+ 402.8% Transports

+ 254.6% Oil

+ 224.9% Nasdaq

+ 188.2% Utilities
+ 191.9% S&P 500
+ 191.4% Dow

+   44.8% Swiss Stock Market

+   27.3% 30yr Treasury Bonds

Oil moves way up in rank over these past few months is it time to start watching reruns of Dallas?? 

Since National U.S. Elections are Rigged by The Globalists, Why are You Voting for Their Candidates?

Today in the United States of America, the American public is kept in check by the Globalists by ensuring that there is only a 2-party system so that the country can be perpetually divided and fighting against each other, instead of uniting together to overthrow the Globalists who control the world’s financial system, and make sure that candidates who serve their interests are leading BOTH political parties.

Here in 2023, 

almost ALL Americans admit that 

national election results are rigged. 

The Republicans have made this a central issue since the 2020 elections, and the Trump campaign recently released a video showing that the Democrats have also complained about rigged elections in the past. 

So why are the majority of Americans today still choosing to support and vote for one of the Globalists’ puppets for the office of the President of the United States?

This country has just gone through and continues to be the most tyrannical and criminal period of our nation’s history with the COVID Scamdemic, 

which the Globalists engineered and controlled through their political puppets, starting with Donald Trump in 2020 who got the whole thing started, and then continued with Joe Biden.

Both of these men who sold out Americans and oversaw mass destruction and mass murders by injection, should be held accountable for their actions and should see the worst punishment possible for their crimes.

But they aren’t. Both men are now running to be “elected” again, and I can guarantee that if there is a national election in 2024, that about half the country will turn out to vote for their favorite criminal and mass murderer.

And the bankers and billionaires on Wall Street and in Silicon Valley will laugh at how easy it is to control Americans and keep themselves rich.

The strongest message that the American public could send to these Globalists would be to simply STAY HOME AND DO NOT VOTE for their puppet candidates!

Something like a 25% to 30% voter turnout would actually send the strongest message possible to these Globalists, communicating that the American public is on to them, and that they are NOT going to participate in their evil schemes anymore.

This would actually terrify them, 

I guarantee it.

But I already know the objections and criticisms that will be leveled against me for even daring to suggest we should not participate in national elections, as this is not the first time I have written this. People want their idols and heroes to vote for, and “choosing the lesser of two evils” is perfectly acceptable to most Americans.

DYI:  I don’t agree entirely with the author’s premise that simply by stop voting – [I’m not advocating either way] – will send the so called elites into a panic.  If the public continues to be governed despite very low voter turn out nothing will change.  The elite’s news media could very easily spin that low voter turn out highlighting our approval of government.

However with this said I do agree that voting especially at the Federal level has now entered into the level of fantasy.  It’s all rigged.  Governor races such as Hawaiian Governor Green’s selection were highly likely rigged setting up for the massive psy-op on Maui.  How far down the rabbit hole??  Local elections rigged as well?? 

Until the American public takes the bull by the horns and forces paper ballots with multiple layers of fraud reducing methods voting currently is a waste of time.

DYI    

 

General Robert E. Lee

“I consider it as the chief source of stability to our political system, whereas the consolidation of the States into one vast republic, sure to be aggressive abroad and despotic at home, will be the certain precursor of that ruin which has overwhelmed all those that have preceded it.”

DYI:  Our Founding Fathers are weeping in shame as the Republic is now lost replaced by an oppressive Military Industrial Complex with shameless overseas wars AND a despotic government that generates non stop propaganda via the main stream press along with select alt media.

DYI

September 21,2023 moved Lt. Bonds from Fear to Desperation

 Sentiment Indictors

Smart Money - Buys Aggressively!

Capitulation

Despondency

Max-Pessimism 

Depression 

Hope - Silver F

Relief *Market returns to Mean  - Short Term Bonds & MMF

Smart Money - Buys the Dips!

Optimism - Gold

Media Attention

Enthusiasm

Smart Money - Sells the Rallies!

Thrill

Greed

Delusional

Max-Optimism  

Denial of Problem - Stocks 

Anxiety 

Fear

Desperation - Long Term Bonds

 My

Opinion

Protected by the 1^st Amendment

Nobody died on Maui due to the fires.

The homes over the past two years were being demolished by contract by the Maryl Group Construction Company headquartered in Honolulu.  The black fabric screens is typical of any construction sites especially those in high traffic areas.  The Main Stream Media (MSM) simply told their audiences that it was a recent addition.  

The homes have been bought by DHS at a substantial premium along with non disclosure agreements all in preparation for this propaganda event.  This type of payoff is not new as it was done to a lesser degree at Newton Conn. home of the staged, faked, nobody shot, Sandy Hook.  DHS paid off the entire town of Newton by paying off all of their mortgages - [on Christmas day!].

Then DHS went to the junkyard just south of Kahului city - Maui Auto Wrecking Junk Yard - bought up a bunch of old wreck cars placed them on the streets burned them out and presto you have your photo op.  Notice in the video none of the cars have any license plates??  They are junk cars.

The fires you saw was done by CGI -computer generated images - all to punch up the fear during Maui's propaganda D-day!  The island that day the internet went down plus a national news blackout during the event which kept the local news media in the dark.  Just in case someone from the island actually thought there were fires by what ever means the police blocked off the only road - route 30 - into and out of Lahaina AND had the police with their patrol boats to keep out any boats that some how thought their were fires or was just there inadvertently.

Why??

This was a multiple agenda event but I'll key on DHS number one propaganda and it is Directed Energy Weapons or more commonly called DEW.  DEW does exist however it is incapable - like in Star Trek - of burning out a single house and is preposterous to take out a small town.  Cars with melted aluminum tire rims is so easily accomplished by using a welder's torch and presto you have your DEW attack!

Nuclear weapons do not exist.  There is nuclear power for sure, but when its nuclear weapons there is no boom in those boom booms!  Plus, nuclear weapons for what ever reason, just doesn't deliver the level of fear when they were faked in Japan during WWII.  In order to control the populous is by the use of fear and it is their hope this will scare at least a decent size of our population.  In other words DEW is a replacement for the fake nuclear weapons.    

And the alt media has swallowed DEW hook, line, and sinker!

DYI

This has been flying around the net...Thought I'd share it with you!

 

Inflation Data Comparison

1970 Median House $15,000

2023 $436,000 Increase 29x

 

Median Monthly Rent $108

2023 $2,000 Increase 20x

 

College [tuition only] per year $500

2023 $11,000 Increase 20x

 

Gasoline per gallon 0.36

2023 $3.80 Increase 10x

 

Median Income $9,000

2023 $56,000 Increase 6x

 

3.5 Children per household

2023 1.9

1970 Dual Income households 47%

2023 65%

For those of us who are the older know this period of time very well, as compared to today economically, it was much easier prior to 1970.  We never thought that way but when President Nixon removed the last vestige for the gold standard in 1971 inflation took off.  Over the subsequent decades the so called official CPI numbers have been cooked along with suppressing the price of gold and its cousin silver all to maintain the illusion of stable prices.

Suppressing precious metals prices is still going on but as the late Benjamin Graham stated “In the end Mr. Market will prevail.”

DYI       

 

U.S. Stocks on a generalized basis - [S&P 500 Index Fund etc.] - are gratuitously overvalued. So buyer or holder beware!

 A

Reminder

J. Paul Getty Quotes!

Stock Market - "For as long as I can remember, veteran businessmen and investors - I among them - have been warning about the dangers of irrational stock speculation and hammering away at the theme that stock certificates are deeds of ownership and not betting slips.

The professional investor has no choice but to sit by quietly while the mob has its day, until enthusiasm or panic of the speculators and non-professionals has been spent. He is not impatient, nor is he even in a very great hurry, for he is an investor, not a gambler or a speculator. 

There are no safeguards that can protect the emotional investor from himself."

DYI:  The U.S. Stock Market has left all sense of investing – as opposed to speculating – for far longer than I care to admit.  Currently the market is showing no better valuations than many months ago when interest rates were back at their sub atomically low level.  Sky high valuations exist, a marker for future returns.  What can be expected for average Joe or Jane Doe that the vast majority use a managed generalized stock fund (Growth Fund) or the old stand by the S&P 500 Index Fund??

Markets Expected Future Returns

Going to MoneyChimp.com let’s plug in the numbers.  Shiller PE 10 as of yesterday was 30.67 with a scant 1.54% dividend yield all for the S&P 500 Index.  Pop the numbers into their calculator using returns over the next 10 years and your answer is – drum roll please – a blazing earth scorching estimated average annualized return of 0.48%. 

Of course this is a nominal return not real returns after all expenses factored.  Commissions and trading costs for the fund, and of course, the worst tax of all inflation will reduce your returns and in this case it will be negative.  Attempting to factor the inflation rate at this current juncture is impossible due to the mass insanity our Federal and State spending forcing the Federal Reserve to monetize – hence monetary inflation – those debts.

So…As far as stocks are concerned this is terrible time to hold or purchase stocks on a whole sale basis.  We’ll just have to wait like the old time hard nosed investor while we watch the insanity of the crowd having their speculative binge!

DYI         

 

Science as control; 

centers of fake knowledge are modern cathedrals; 

The Big Con

JON RAPPOPORT

AUG 10, 2023

I continue to write about this subject because it’s vital.

NIH, the US National Institutes of Health, is the largest medical research facility in the world. It has 18,000 employees and runs on an annual budget of $45 billion.

I once suggested to Jim Warner, a White House policy analyst under Ronald Reagan, that somebody should do an audit of NIH and determine exactly what medical advancements the agency had actually made during its long history. He thought that was a terrific idea. But nothing came of it.

I assure you, an audit would reveal much less than meets the eye. Much less in the way of useful discoveries and technology. Along with mountains of useless and fraudulent science.

BUT NIH stands as a center of knowledge and a symbol, a reference point, a proof positive that medical science is marching forward.

It’s a very expensive public relations tool.

How could we not accept and signal our obedience to medicine, when we have such an awesome modern cathedral for its research?

Ditto for the CDC and the FDA.

 Both infernally corrupt agencies.

CONCOCTED science is the modern version of spiritual revelation. The Roman Church—while it was carrying out witch hunts and inquisitions replete with confessions obtained through torture and capped off with death by burning at the stake—was claiming Jesus Himself had passed the keys of the Kingdom to the Church…and He tacitly approved its policies.

These days, debilitating, brain damaging, and life-destroying vaccines are the scientific revelations the Church of Federal Medicine stands for.

Concocted science.

People accept science as fact, based on the IMPRESSION that actual knowledge is being discovered.

PR people make sure this impression is delivered.

Just as the Roman Church never confesses to fraud in its doctrine, the centers of modern medical knowledge never confess fraud.

Thanks Jon

DYI

 

“The illusion of freedom will continue as long as it's profitable to continue the illusion. At the point where the illusion becomes too expensive to maintain, they will just take down the scenery, they will pull back the curtains, they will move the tables and chairs out of the way and you will see the brick wall at the back of the theater.” 

Frank Zappa

Another month passes as stocks remain at nose bleed valuation. Gold is shining and Lt. Bonds show promise.

 

Updated Monthly

AGGRESSIVE PORTFOLIO - ACTIVE ALLOCATION - 9/1/23

Active Allocation Bands (excluding cash) 0% to 50%

28% - Cash -Short Term Bond Index - VBIRX

50% -Gold- Global Capital Cycles Fund - VGPMX **

 22% -Lt. Bonds- Long Term Bond Index - VBLTX

 0% -Stocks- Total Stock Market Index - VTSAX

[See Disclaimer]

** Vanguard's Global Capital Cycles Fund maintains 25%+ in precious metal equities the remainder are domestic or international companies they believe will perform well during times of world wide stress or economic declines.  

 This blog site is not a registered financial advisor, broker or securities dealer and The Dividend Yield Investor is not responsible for what you do with your money.

This site strives for the highest standards of accuracy; however ERRORS AND OMISSIONS ARE ACCEPTED!

The Dividend Yield Investor is a blog site for entertainment and educational purposes ONLY.

The Dividend Yield Investor shall not be held liable for any loss and/or damages from the information herein.

Use this site at your own risk.

PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS.

***********************************************************************************

Margin of Safety!

Central Concept of Investment for the purchase of Common Stocks.

"The danger to investors lies in concentrating their purchases in the upper levels of the market..."

Stocks compared to bonds:

Earnings Yield Coverage Ratio - [EYC Ratio]

Lump Sum any amount greater than yearly salary.

PE10  .........31.04
Bond Rate...5.25%

EYC Ratio = 1/PE10 x 100 x 1.1 / Bond Rate

1.75 plus: Safe for large lump sums & DCA

1.30 Plus: Safe for DCA

1.29 or less: Mid-Point - Hold stocks and purchase bonds.

1.00 or less: Sell stocks - Purchase Bonds

Current EYC Ratio: 0.68(rounded)

As of  9-1-23
Updated Monthly

PE10 as report by Multpl.com

Bond Rate is the rate as reported by

Vanguard Long-Term Investment-Grade Fund Investor Shares (VWESX)

DCA is Dollar Cost Averaging.

Lump Sum is any dollar amount greater than one year salary.

Over a ten-year period the typical excess of stock earnings power over bond interest may aggregate 4/3 of the price paid. This figure is sufficient to provide a very real margin of safety--which, under favorable conditions, will prevent or minimize a loss...If the purchases are made at the average level of the market over a span of years, the prices paid should carry with them assurance of an adequate margin of safety.  The danger to investors lies in concentrating their purchases in the upper levels of the market.....

Common Sense Investing:
The Papers of Benjamin Graham
Benjamin Graham

********************************************************************************************

%
Stocks & Bonds

Allocation Formula

9-1-23
Updated Monthly

% Allocation = 100 x (Current PE10 – Avg. PE10 / 4)  /  (Avg.PE10 x 2 – Avg. PE10 / 2)]

Formula's answer determines bond allocation.

Current PE10.....31.04

Avg. PE10...........17.05

% Stock Allocation    0% (rounded)
% Bond Allocation 100% (rounded) 

Logic behind this approach:

--As the stock market becomes more expensive, a conservative investor's stock allocation should go down. The rationale recognizes the reduced expected future returns for stocks, and the increasing risk. 

--The formula acknowledges the increased likelihood of the market falling from current levels based on historical valuation levels and regression to the mean, rather than from volatility. Many agree this is the key to value investing.  

Please note there is controversy regarding the divisor (Avg. PE10).  The average since 1881 as reported by Multpl.com is 16.70.  However, Larry Swedroe and others believe that using a revised Shiller P/E mean of 19.6 , the number since 1960 ( a 53-year period), reflects more modern accounting procedures.

DYI adheres to the long view where over time the legacy (prior 1959) values will be absorbed into the average.  Also it can be said with just as much vigor the last 25 years corporate America has been noted for accounting irregularities.  So....If you use the higher or lower number, or average them, you'll be within the guide posts of value.

Please note:  I changed the formula when the Shiller PE10 is trading at it's mean - stocks and bonds will be at 50% - 50% representing Ben Graham's Defensive investor starting point; only deviating from that norm as valuations rise or fall.        

  

DYI

This blog site is not a registered financial advisor, broker or securities dealer and The Dividend Yield Investor is not responsible for what you do with your money.

This site strives for the highest standards of accuracy; however ERRORS AND OMISSIONS ARE ACCEPTED!

The Dividend Yield Investor is a blog site for entertainment and educational purposes ONLY.

The Dividend Yield Investor shall not be held liable for any loss and/or damages from the information herein.

Use this site at your own risk.

PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS.

The Formula.

A value based allocation strategy

February 19, 2010 by John Kingham