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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, ho
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The Power Of A Diversified Portfolio

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Just a quick note for today.

Just over a month ago, I wrote an article for Seeking Alpha in which I suggested 20 Top Stocks For A Monthly Dividend Portfolio along with 2 "bonus" suggestions.

Today, Apple was hit by a Wall Street Journal article confirming rumors of iPhone 8 production delays. General Electric got trashed by a negative JP Morgan note. Speaking of JP Morgan, it too got hit by, from the best I can tell, a continuation of concerns over falling interest rates. And Starbucks appears to have another general case of the blues.

Guess what? All of these stocks are in my portfolio. They are represented by the areas highlighted in red below. I also highlighted AT&T, falling solidly as well, for good measure.


Ah, but go back up and take a look at AbbVie. Up 6.26%! Why? It turns out that they received a favorable decision with respect to patent protection for key drug Humira. You'll see AbbVie as one of the areas featured in green above. I also highlighted some positive moves in Johnson & Johnson, 3M Company, and Microsoft.

Bottom line? On a day when two of my holdings were hit with very specific bad news and another fell fairly sharply based on overall economic conditions, the overall portfolio is only down .16%.

Here's another picture, captured within a minute of the screen capture of my portfolio. It's the status of the market averages, from CNBC.



My point? A well-diversified portfolio will serve you well, even on days when some of the components get hit with a little bad news.

Even so, don't limit yourself to these 20 stocks. In a follow-up article, I suggest 7 ETFs to help you create a truly diversified portfolio.

Happy investing!


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Clearly, Not Everyone Is Getting Rich Off The Stock Market

By -
Image
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, ho
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