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Showing posts from September, 2015

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Clearly, Not Everyone Is Getting Rich Off The Stock Market

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Well, the NY Fed was out today with its Quarterly Report on Household Debt and Credit for Q4 2017. Clearly, Americans are in a lot of debt. Take a look.


Just a couple of quick hits from the report. Total U.S. household debt rose $193 billion in the 4th quarter, to a new all-time peak of $13.15 trillion. That's 17.9% above the most recent trough in Q2 2013. Broken down by segment, what do you suppose was the largest gain in percentage terms? Credit cards, with a 3.2% increase. In the picture above, the widening gap represented by the red arrows reflects the fact that non-housing debt is rising at a faster pace than housing debt.

Here's what's troubling about that. Below is a picture of the stock market, as represented by the S&P 500 index, over that same period; from the most recent credit trough in Q2 2013 to the end of 2017.


And thus, the title of this article. Over that period, the S&P 500 index rose by 75%; from roughly 1,600 to 2,800. Apparently, however, the r…

On Substituting Dividend-Paying Stocks For Bonds In The Current Environment

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Today's article is going to come from a very interesting place for ETF Monkey.

Readers who have followed my work will by now be familiar with its main focus, namely using ETFs to build low-cost, extremely diversified portfolios. An example of this is the ETF Monkey Vanguard Core Portfolio; based on just three ETFs yet offering well-balanced exposure to both domestic and foreign stocks as well as bonds. In the article linked above, I advocated establishing target weightings and sticking to these. I wish to reiterate that, for many investors, I would recommend sticking to that game plan.

ETFs form the core of my portfolio, comprising 81.11% of my total portfolio as of this writing, and I am very conscious of maintaining and rebalancing to target weights.

However, I occasionally make an exception and maintain modest positions in individual stocks for specific reasons. As of this writing, two such positions are AT&T Inc. and Verizon Communications, each of which holds a weighting …