2011 Monthly Expenses Assessment... Part 1... Where's all the Money going??

Only seven more days of RRSP season left... a time to assess our finances and plan for the upcoming year...

Today, the Vanier Institute of the Family released a report indicating the Canadian household debt has hit the six- figure mark: an average at the end of 2010 of $100,879. Also, a debt to income ratio at a record 1.50! That means for every tax free dollar a Canadian household earns, they spend a $1.50. The big 3 monkeys: mortgage, personal loans, and credit cards. For those with mortgages, the average debt came in at $171,500.

This news got me thinking about where our household money was going and with noticing our utilities were on the rise yet again as were our taxes, it is time to take another look at our monthly expenses and where we might have to cut back as we haven't assessed it in detail since 2003.

In 1997, my fiancee and I decided when we purchased our home, we had to be frugal; because of the instability of my steamfitter trade (seasonal construction or maintenance), we had planned to keep our monthly costs down enough so that my would-be spouse could afford all the bills by herself or I can afford all bills while collecting Unemployment Insurance payments until I found another job which pretty much was the same amount as her gross pay in 1997.

In 1997:

Mortgage- $480 per month conventional; no CMHC with over 25% down payment.

Northwestern Utilities- bills fluctuated between $11.00 to $88.00 (winter); $37.00 average for natural gas.

Edmonton Power/ Aqualta- $62.00 average for electricity, water and drainage.

Videotron- $27.47 for cable- basic plus and multi-service plan.

Telus- $21.00 for phone services not including long distance.

Property Tax- $136.04

Home Insurance- $30.17 same exact plan I have now.

Life Insurance- $18.00 for the bank's pay your mortgage off if someone dies insurance.

Bank Fees- $9.00

Car Insurance- $75.00 for 1 vehicle PLPD.

Cellular- NIL

Alberta Health Care- $34.00 per month for family plan

Gym Membership- $22.45 at Club Fit.

Groceries- $75 per week including gasoline. There was only 2 of us back then and price at the pump was 29.9 cents per litre!

Grand total in 1997: $910.13 without groceries. $1210.13 +/- $200 with groceries and gasoline as we did grocery shopping less often and ate out more. Back then, mortgage payments and all bills came to around $1000 per month. The $413 per week pre-tax from UI more than covered those costs plus groceries which we to this day have an unlimited budget for and saving up for a wedding!

It will be interesting to see if we could afford to live today on that same budget just in case I was to be suddenly unemployed for any length of time.

And so: 2011 bills...

Mortgage- NIL

Enmax (Jan.) $295.22 electricity and natural gas. On the high side as December had a good cold spell; average $245.00 with more gas in winters and more electricity used in summer to balance out.

Epcor (Jan.) $117.75 water and waste mgmt. drainage; on the high side again. Average is $82.00...

Shaw (same monthly) $78.70 digital cable plus HD pkg.

Telus (same mthly) $86.87 telephone pkg with High Speed ADSL; Telus has announced a $2.00 increase coming in March...

Property Taxes- $213.21 no interest paid directly to the City.

Home Insurance-$78.25

Life insurance- $29.87

Auto Insurance- Morgex- 2 vehicles $89.90; $million liability on both.

Car Payments -NIL

Bank Fees- $32.90 incl. Safety Deposit Box

Cellular Phone service- $93.25 iPhone plus wife's phone plus iPad 3G

AHC- NIL no more Albera Health Care Premiums!!!

Gym Membership- $41.98 at World Health Club

Groceries- Averages about $400 per week including gasoline. $1600 per month.

Misc.- Hockey, tuition, sports activities for the boys- approximately $2000 per year.

Grand Total: $1073.93 +/- $100 for cost fluctuations without groceries. $2673.93 with a good cart-full at Costco or Superstore and weekly gas. +/- $100 for stocking up weeks or don't need much this time weeks....

The maximum EI benefit in 2011 is $468 per week pre-tax. After taxes, every 2 weeks, I would probably get just over $800; hence that wouldn't go very far with the bills we have today without cutting at least $1000 per month out of our monthly expenses. YIKES!!

Luckily I still have a job and it is good to see where the money is going... if the economy turns for the worst, cable would go, replacing phone service with VOIP, gym membership gone, halving of car insurance to 1 vehicle, and a closer look what's in our shopping cart would whittle that $1000 away hopefully.

2011 GOALS:

First Priority: We are spending $1922.80 more per month now than we did 14 years ago! $643.80 not including groceries and gas and taking into account we have no mortgage payment anymore. Getting some of that back will be the first priority. If we keep spending the way we are now, it costs us $32,087.16 plus $2000.00 for sports. Add annual vacation at $5000.00...totalling $39,087.16 without going out, ordering in,etc. Something's gotta give!

Second Priority: taking a good look at our grocery list... it will grow over time with 3 boys in the house so now's the time to analyze the necessity of the items in our cart and collect receipts for outside expenses like eating out, entertainment, etc. Thing is, when has anyone walked into Costco and walked out without a $300.00 tab???

Third Priority: 2012 TFSAs, RESPs, RRSPs, and savings... to maximize these, I would need $10,000 for the TFSAs, $7500 for the RESPs, and $5000 for the RRSP: totalling $22,500 per year. And personal savings goal of $10,000 this year...

Misc: Need new shingles and outside doors with screens...expecting costs to be $10,000.00; flooring for bedrooms and new drawers..$2000.00

$83,587.16 of already taxed money needed for 2011 if we don't adjust some spending habits...

Not looking good in accomplishing these goals unless I head to Ft. McMurray.... may have to opt out on maximizing the RESPs and installing new doors.... and the wife was asking for a kitchen reno soon... okay..I'm a wee bit taken back by the number now considering we have no long term debt like credit cards and personal loans... looking for the defibrillator...

In part 2, I will take a closer look at our monthly bills excluding groceries and gasoline like those Statscan guys do with their monthly CPI looks... to see how much of the increased spending since 1997 is actually inflation or additions to our standard of living or just wasteful spending we're not aware of... TO BE CONTINUED...

RESPs, TFSAs, and RRSPs... What to do...

So as my eldest son turned 10 years of age this past week, I figured it was time we started really planning ahead in terms of his education, etc. Over the past 10 years, all 3 kids have accumulated just over $4000 in birthday money, Chinese New Years gifts, and Christmas money... finally enough to maybe buy a GIC or a bond rather than let it sit in a savings account and earn next to nil.

When the eldest was born, we had looked into perhaps opening a RESP account for him. At the time, the Government of Canada was offering a 20% grant up to annual max of $400 towards an RESP (so a $2000 contribution). All the rules and exceptions involved at the time swayed my decision to start an RESP: Back then, only 4 year university programs and a handful of technical school (NAIT, SAIT) programs qualified as post-secondary schooling that an RESP could be put towards; trade school certification courses were not included nor was community college programs. So, instead we decided to focus on paying down our mortgage and maximize our RRSP contributions.

Currently the rules have changed: now the maximum grant has increased from $400 to $500 (still 20% of annual contribution); lower income earners can receive a larger grant (up to $600 annually for incomes lower than $40, 970 and $550 on incomes less than $81,941); and more post secondary schools can be paid with an RESP including trade certification programs. Hence, a lifetime maximum of $7200 per child can be received through the Canada Education Savings Grant (CESG). Not bad. Details here...

And, with the additional Alberta Centennial Education Savings Grant added towards the RESP, suddenly opening an RESP is worthwhile. The ACESG deposits $500 into an RESP for every child born to Alberta residents in 2005 and after; additional grants of $100 is available for those children who turn 8, 11, and 14 in 2005 or later (an extra $300) with a minimum contribution by Alberta residents of $100 to their RESP. Details here.

With the introduction of the TFSA - Tax Free Savings Account in 2009, we figured this was THE way I could get the wife some sort of pension and because the rules are much more flexible in a TFSA, it provided a great way to pay for our children's education too! A maximum contribution of $5000 is allowed in a TFSA but the amount can be withdrawn without penalty or taxation and be put back in future years without losing any contribution room!!

So... what to do? RRSP, TFSA, or RESP? So here's my plan: do them all! Being mortgage and debt free has its benefits... if you are swimming in debt or have a large mortgage, maximizing any of these would seem next to impossible.. but if you prioritize in the same order and contribute what you can, it's not all that bad.

First priority is to maximize contributions to my RRSP for the tax deduction. Since the wife is a stay at home parent, there is no real need to contribute to her RRSP as she has no income or taxes to pay. If you have a corporate pension and your wife stays home, buy a spousal RRSP for her for the tax deduction.

Next priority would be to maximize both TFSAs every year. As I have a union pension, the RRSP contribution room will be minimal and enable me to do this. A TFSA for a stay at home parent is a great way to 'income split' and a glorious way to save for a spouse's retirement. Using the additional tax refund from contributing to your RRSP is the best way to come up with the funds for a TFSA.

RESPs will be the last priority for contributions... with extra effort to maximize contributions in the years the kids each turn 8, 11, and 14 in order to qualify for the ACESG. I put this as the last priority because of the rules the RESP has.. If finding the funds are low, my advice would be to contribute to the RRSP and TFSA first and only put in $100 in the RESP to qualify for the Alberta resident grant in those particular years.

So this year, all 3 kids got RESPs with maximum contributions from their own savings and a top off from my tax return from last year: $2500 in each account. Each will receive $500 from the Government of Canada. The second eldest will get an additional $100 for turning 8 years old this year and the youngest hit the jackpot with an additional ACESG of $500. So the original $7500 contribution now totals $9600: a 28% return without investing in one single instrument! Free money is always nice.

Only problem now is if I wanted to maximize all those above accounts annually, I will have to come up with $17500 for the TFSAs and RESPs and an additional $3000- $6000 for the RRSP annually. And since it's already taxed money being contributed, that works out to coming up with $47,000 of annual income specifically for our family's futures. YIKES!!

Portfolio Update...Playbook 2011

Its already mid February and time to check up on the ol' stocks...

$AAPL—still sticking with $AAPL- up over 10% since the start of the year. Ipads sales were incredible and news of the Verizon iPhone 4 selling out on initial pre-orders in less than 24 hours (close to a million) helps. With a P/E of 20 and , even at $360 per share, this is a cheap stock. Core holding- long.

$RIMM- I like it and am watching for an entry. Blackberry customers are loyal and RIM's numbers will continue to beat market expectations. No position.

AGs: the theme of 2011 continues. $AGU, $MOS, and $POT all beat expectations and posted great outlooks in the sector. Continuing to ride the momentum. Long $POT and $MOS; traded my $AGU shares to get in on the Potash 3 for 1 split. All AGs pulled back today—a great opportunity to pick up a few more shares. Looking for re-entry in $AGU.

Uranium: watching this sector carefully; uranium spot prices continue to rise. $CCO, $UUU, and $DML (all on TSX) are the market leaders to watch. No position.

$LULU: Traded my Lululemon shares for more Potash for the split. $LULU continues to grow and post great numbers... but its P/E and valuation remains quite high among its peers in the sector. I felt people need food before women's yoga apparel... No position. Looking for re-entry for the wife's TFSA hopefully in the high $60's.

$ZAGG- a great trader stock. Seems currently range bound between $9- $10 but will most likely pop through earnings. No position. Took profits recently and watching for re-entry in $8 range.

$SU- watching for re-entry under $38. Oil will continue to play a theme for 2011...it will toy with $100 bbl.

$CMI- continues to look great as a long position or a trader; load up under $106; take profits at $113 or over will make you a ton of bucks! Currently no position.

$MELI, $MCP- on the watchlist. No position.

$INT, $AAA- my Magic 8-Ball picks for 2011... Both on the TSX Venture exchange and both continue to hold up well forming solid bases after the hype clears. Long on both.

Do your own DD... I do not recommend BUYING any of these stocks without doing your own DD first... these are stocks I currently own or am trading.... watch for any updates on my twitter feeds or facebook updates.

Forgot How Exciting these Pennies can be.... But...

In the last 2 weeks I have added 2 micro-cap stocks to the portfolio— $INT and $AAA... $INT- Intertainment Media...a conglomerate who owns ortsbo.com— a real-time translator for social media; $AAA- Allana Potash- a potash junior focused on exploring property in Ethiopia...

I've never bought a real penny stock in years; In fact, I haven't owned anything under $10 in quite a while... small cap ventures involved maybe a scalp or two in a few China stocks like $CCME, $TRIT, and $LIWA..all were over $10 and followed an ongoing theme last year for popularity in Chinese stocks....

I like the movement of the market leaders like $AAPL and $POT... going up double digits in one day... and if and when it pulls back, if you've done the DD, you've have nothing to worry about; they always come back after consolidation... I like predictability... I like certainty in the charts...I like the fact that I can walk into an Apple Store or a Lululemon store and say ...yeah..they're going to be fine... or time to sell...

With pennies, what I've found in the past, it was, first of all, hard to research and do proper due diligence, but also almost impossible to control the greed factor when they blast off; and usually I end up chasing them up, getting emotional, believing all the hype around the bullboards, panic selling, and generally ignoring most of the rules and principles of investing and trading, I have learnt and abided by over the years! And, I hate when I get emotional— too many dumb decisions are made....

But man! The excitement levels are second to none!!! Watching a pick soar like $INT and $AAA the past 2 weeks and coming out looking like a genius when you triple or quadruple your original investment...then ponder your own methods, credibility, and judgement when it turns the opposite direction... like the flash crash with $AAA yesterday...adrenalin and excitement coursed through my veins over the last 2 weeks just like when I was starting out trading stocks and pennies circa 2003 with names like Oilexco, UTS, UEX, Diagnocure, Pangeo Pharma, Constellation Copper, CV Technologies, Pacific Safety to name a few....

... meanwhile I was totally missing out on glorious opportunities in other equites because I was too busy and excited staring at the movements of $INT and $AAA.... I made off with some incredible profits in a short amount of time with these babies but also got stung bad with a few.. some waiting years on hold to even collect on the tax loss of the company totally disappearing into oblivion.

That being said, I took a harder look today and had to give myself a slap!

My shares of $INT and $AAA comprise of less than 1/2 of ONE PERCENT of my total portfolio— even if I lost my wad spent on $INT and $AAA, it would not make a dent in the portfolio... AND here I was spending, way too much time reading the BullBoards for rumours again trying to find out what happened and if I should sell or buy more.... while a core holding like $AAPL was so totally tradable today with its own mini crash, I missed out on a lot of potential cash being

made....

$INT and $AAA are Magic 8-Ball picks...for fun, a quick scalp like they were originally meant to be.... They involve as much research and diligence as shaking the Magic 8-Ball for a BUY or SELL signal....

I do like the concepts and the potential of the companies but buying them is really akin to putting a few chips on red and spinning the wheel... it just happened to land on red 2 weeks ago and suddenly I was mesmerized by the action and thinking I was ready to be a professional gambler!!

So back to reality.... boring but predictable... not as lucrative but safe....

2011 Playbook ..7 trading days later...

Seven trading days into the new year and so far... I've added a few positions and taken some profits.. and outlook remains the same...

..sticking with Apple is always a good idea.. $AAPL: from $329.57 on Jan 3 to $341.64 (+$12.07 +3.7%)... today Verizon announced it will now carry the iPhone on its CDMA network; which means Apple can potentially double its revenue stream for iPhones... Android phones will still be a factor in 2011 but with Verizon aboard, nobody is going to walk into a Verizon store to play with an iPhone then walk out with an Android... add a CDMA iPad or iPad2 in the mix...

$RIMM still watching this one... waiting to get in at a lower price point. Low $50's would be dandy...

AGs will be the story for 2011... $POT jumped $9.49 since Jan 3 (+6.1%); on a little pullback currently and a great time to open a half position around $163.00 or lower. $AGU and $MOS are unchanged from Jan 3 because of the recent pullback but both have seen its 52 week high hit in the last few days...

$CCJ ($CCO) , $DNN ($DML) watching... uranium fundamentals look great with oil nearing $100 per BBL.

$CMI marginally down since Jan 3 but crossed over the $112 ceiling on numerous occasions in the last few days... get in around $109.

$LULU ($LLL) was currently on a slight pullback but have raised their outlook after hours today and is up over $5 after hours.... never doubt women who want clothes to make their butts look good... its small float will continue to drive its price up for 2011. Get in under $68 if you still can.

$ZAGG has been on a tear as of late... going from $7.91 on Jan 3 to $9.74 (+$1.83; +23.1%)... more iPhones on the Verizon network means more protectors needed...

$MELI up +$4.09; + 5.8%

$MCP down -$4.26; −7.4% expected a pullback in this sector...

Not bad for 7 days.... 2011 is looking good so far... still weary of an early overall market correction...

Disclosure: Long $AAPL (core holding); long $POT, $AGU, $MOS, $LULU, $ZAGG; no positions in $MELI, $MCP, $RIMM; out $CMI for slight profits...

My 2011 playbook...

Keeping up with tradition of most financial bloggers at the start of the new year with some picks and themes for the new year:

With the introduction of the iPad last year, Apple create created a whole new class of computing... stick with $AAPL... Android may overtake iOS in numbers this year but Apple makes a pile of cash and iPods and iPad and ATVs are never included in the numbers that AAPL bears give when talking Android market share. Plus, $GOOG gives Android away for free... watch 3rd party tab makers hedge their bets with WindowsMobile 7 tabs too as they fight it out to the bottom...Apple sold a ton of gear over Christmas and should run up into earnings... nobody is making an "Android killer" yet...

$RIMM isn't going anywhere... Blackberry users are loyal and their security is better than all the other smartphones out there today; while their new tablet, the Playbook, may still flop in terms compared with the iPad, they will sell a ton of them regardless of the battery problems... wait for major overall correction with $RIMM.. it's still also a takeover target if Windows tabs and phones flop.....though it is sitting at its 200SMA right now, under $50 is nicer... on the watchlist...

the return of AGs and Uranium stocks... Fertilizer plays and uranium plays will be big in 2011... For ferts: go with $POT, $AGU, and $MOS.. beware of profit taking early January as these have been on a tear the last few weeks... great entry points on the pullbacks.... stick with larger plays like $CCO and $DML for uranium...

commercial trucking... $CMI is a good safe bet for 2011.. they got a great balance sheet and with the US government focusing on fuel economy and higher emission standards for commercial trucks, Cummins is your best bet.

retail: $LULU.. never mess with women with money who want to look good... lululemon has been an institutional favourite last year and its PE is through the roof, but with its tiny float, it can only mean higher share price... get in on any pullbacks..and this should run nicely into earnings for Q4..the lulu stores were absolutely packed during the holiday season...

$ZAGG is a nice retail play for 2011 also...all those expensive "itoys" needs protection...

$MELI- the eBay of Latin America... they got home court advantage...

$MCP- molyCorp is a new rare Earths play... IPO last summer and is already up 200%...Rare earth metals are definitely in bubble territory but there's still a lot of momentum in the sector for 2011... especially with smartphones and mobile tablets taking off... Canadian rare earth plays: $REE $AVL $GWG

Oil will flirt with $100 a BBL in 2011... get in the bigger players on overall market correction.. $XOM $SU

Caution of a January correction.. the market indicators show overall markets are oversold and will pullback..great time to get in a lot of these not so cheap stocks...

Do your own DD... I do not recommend BUYING any of these stocks without doing your own DD first... these are stocks I currently own or am trading or will be acquiring in the short term future as of Jan 3, 2011... watch for any updates on my twitter feeds or facebook updates.

2010 has come and gone...

HELLOOOOO 2011...... Wow...I haven't posted anything since February of 2009 and it was just 3 little blurbs... and before that 2008.... so here goes...

Suddenly it's 1/1/11!! Since then we've been through the worse economic downturn since the Great Depression and the introduction of the iPad!! In Canada, oil companies went into panic mode and did some cutbacks but real estate values took a small dip but held onto their values nicely...

So as I download financial statements for the past year, I also reflect upon the past year and decade as I go into my 11th year of trading stocks online.. all in all not too awful bad...

2010 average earnings from job: even with an 8% total pkg increase, the bank acct didn't grow that much with the lack of OT & a lot extra time off this year... SIGH...

2011 welcomes EI ($786.76) and CPP ($2163.15) payments again.. and with extra time off for the Yuletide season this year, I can definitely say I spent more than I earned over the holidays.. YIKES!

But I did manage to top off and max out my RRSP and still pay off the monthly bills... But it could be a rough first few months of 2011...

2010 financials as of Dec 31st:

TSX +14%; DOW +11%... portfolio goal +9%;

ACTUAL portfolio +34% WooHoo!

Not the +110% seen last year but sure beats the 2 consecutive years (2007 & 2008) of losses of -25% per year which observed my portfolio drop off the face of the Earth to 2004 levels...

But not bad considering it has been 10 years and 1 month since I started trading online... portfolio since Dec 2000 +1004%

I actually started investing in 1998 when I bought some TD INDEX funds with a $350 tax return after dumping every cent I had to come up with a 27% down payment on our home so I wouldn't have to pay the CMHC premium... laugh if you want, but 1997 saw some rough economic times..every cent mattered and I was quite nervous signing for a mortgage back then... maybe it was because I was unemployed at the time and only worked 6-8 months per year average in the 90's... plus it didn't help that everyone, EXCEPT my dad and my RE agent, Eden Hampson, who also happened to be my karate instructor, told us it would be a HUGE mistake buying real estate back then...

WHAT I LEARNT SO FAR:

-when learning about money...learn everything there is to know about money- that includes taxes, debt control, real estate, interest rates, insurance, and being frugal; not just stock and bond picks.. you'll never learn it all but you what you will find is they're all related to each other...

-when deciding to invest, I made it a hobby; people spend more time and effort with their hobbies than their families or their jobs. Take a guy whose hobby is rebuilding cars for example... he knows more about that car and has spent more time and money in doing so than any guy who does it for a living...

-money flows 2 ways: 'IN' and 'OUT'; no matter how much you think you can control the money coming 'IN', you're really only in control of the 'OUT'... Why do you think all those people who work all those overtime hours or extra jobs never really get out of debt..sure, they may temporarily ease some pain but when the overtime stops, there they are begging to be transferred to another money job...

- rule of 72... learn it, know it... live it... if I can get 10% return on my money, it will take 7.2 years to double; if I get 7.2%, it will take 10 years to double... 69 is a more accurate number but people tend to think you're talking about something other than compound interest for some reason...

-a 100% tax write-off does NOT mean "FREE"... plus to 'write' something off, you actually got to make some money...

-compound interest is your BEST employee- he works for you 365 days a year and never takes a break! ; BUT if you have debt, he will haunt you 24/7...

- Scotiabank is completely wrong: you REALLY have LESS than you think. Canadians as of 2010 spend $1.42 for every dollar they earn... and what you got left on your line of credit is NOT added to your NET WORTH...

-a tax return ISN'T 'bonus' money... nor is it "extra" spending money...

-never owe more than 2.5 times your annual GROSS INCOME for a home and have at least 10% down... IE. if you make $80K per year, your mortgage should not exceed $200K... when homes cost $400? Get a bigger down payment. SIMPLE.

-From David Chilton (Wealthy Barber): pay yourself first and save your way to prosperity...remember the 10% rule...

- from Robert Kiyosaki (Rich Dad Poor Dad): never buy your TOYS with the money you earn; BUY ASSETS; let your ASSETS buy your TOYS... but first you must learn what an asset is...

- from Eden Hampson (Re/Max): "people upgrade their homes for 2 reasons: size and location- make sure your home has both... if you have to upgrade your house because it's too small or for any other reason in the next couple of years no matter how much you think it has appreciated, the only person that really makes money is me, the Real Estate guy..."

-from Eden again: if you are planning to have a family, never count on the lower income earner's wages when deciding how much you can AFFORD on a home... being able to afford a home with one income saves so much grief later in life...

-from my dad: "there's no such thing as 'easy money'... if money fell out of the sky, you couldn't get easier than that could you? Well, you would still have a sore back at the end of the day picking it off the ground.."

-from my dad again: "you can make whatever you make with your job and do all the overtime you want; and I'll make $10 per hour in business- I'll have more money than you at the end of the year... it's not about what you make son..."

-anyone can pick stocks and every 3 of 4 will be winners whether you have a monkey throwing darts at the newspaper or research them like you're going after a Nobel Prize; when to buy & when to sell is the HARD part. And I'm not talking about timing here...

- timing the markets is IMPOSSIBLE regardless of what someone may think they know or what they tell you: if everyone knew a way to time the markets perfectly, either stocks would be worth nil or everyone would be rich...

-it really does take money to make more money... it takes a lot of money to make a little too... so don't think your measly $1000 is gonna make you a mil... SAVE. Do the rich get richer? Damn straight.

-know when to get out: if you have a flower garden, you pull your weeds and let your flowers bloom don't you?; so why do so many sell their winners and double up on their losers in the stock market??

-learn to talk about money.... openly and honestly... 99% of my parents' fights and arguments were over money; and they always had food in the fridge and a roof over our heads... when my first child was born I vowed to do the same without the money fights...

-from Peter Lynch (Beating the Street): when your cab driver gives you a stock tip, it's time to get out of the market... same holds true with pipefitters and welders: when they suddenly become stock market experts but have none to show for it, SELL everything... when they become the real estate gurus, it's time to move to Skatch...

- never let PRIDE or what you think what people may think of you get in the way of you making money... that goes the same for SAVING money... quit trying to impress others or get used to being broke.

-that being said, never let making money or your GREED get in the way of your health and well-being or spending quality time with your family.... money means nothing when you're lying on your deathbed; and, it's all FOR nothing without your family to share in your financial successes...

-after 10 years of doing this, and the more I do this, the more I realize I know nothing.... education is the best investment anybody will ever make...STUDY

HAPPY NEW YEAR!!

If I had Bill Gates' money...

It's funny how the people with no or little money know exactly what they would do if they were rich; we dream about it every day, so we should know, just in case we do happen to stumble on a lottery win or a grand inheritance.  But it never holds true the other way around:  you never see the rich dreaming about being poor...or even thinking about what if they lost all their money.  Big difference between those that "have" and those that "have not"... 

Even if you got caught up in the euphoria and success of the recent Alberta Oil Boom, made off like a bandit in the hysteria of the real estate boom, and think you have become one of the "haves" in the social echelon, this very notion will determine if you really have climbed the social ladder into the confines of the truly rich or you are just kidding yourself surrounding yourself with petty purchases in hopes of keeping up with the Jones'.  In fact, people like that worry about their finances every day; the Rich do not.

 With the recent Stock Market upheaval, do you really think Warren Buffett or Bill Gates, losing billions in equity of their holdings over the past year, are concerned with money, or lying awake in bed at nights thinking what they're going to do if they do not make their next month's payments?  I doubt it.  Only the people that have none worry about money.

The true Rich do not dream about having no money and in most cases, do not know what it is like to be poor.  And, they are so rich, they don't need money.  The reason is perhaps their wealth is not build on the foundations of credit borrowing or debt like the rest of us swimming among those of the "Middle-Class" or "working- poor"; which really is the same IMHO.  That is why the Rich can be broke but never poor.

Preparing for the Big Bounce, then the New Depression

Quite a pessimistic view of the next 10 -20 years but Dent was the most optimistic in the last 20 years... 

What's scary is he has predicted most of these bubble economies since the 80s...