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Author: desertdaveataol Big funky green star, 20000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 1109  
Subject: Brinker Still Advising GNMA funds Date: 7/12/2008 6:26 PM
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Bob Brinker is still advising GNMA's! several times on today's show he told people they did right when they bought GNMA's, telling one woman "You're a winner!

For those who worry about asset value fluctuation, in GNMA's, he still advises laddered FDIC insured CD's.

We've got a big chunk of our $$$ in Vanguard's GNMA fund so I was glad to hear that.

On a related note; one caller asked about her money in a Fidelity Money Market fund. Brinker told her several times, using the strongest terms he could use on the radio without getting sued, that he had cash in a Money Market fund. But he did not have money in any Fidelity Money Market fund.

Given that the two most often mentioned companies on Bob's program are Fidelity and Vanguard I'm taking that to mean Brinker's short term funds are invested in Vanguard's Money Market fund.

With Vanguard's GNMA fund you've got Fed backing and you can have a check book (min check $250) so as to have instant access to your money if you need it.
https://personal.vanguard.com/us/funds/snapshot?FundId=0036&...

Or, if you have enough money
https://personal.vanguard.com/us/funds/snapshot?FundId=0536&...

The Government National Mortgage Association (GNMA, also known as Ginnie Mae) is a U.S. government-owned corporation within the Department of Housing and Urban Development (HUD).

Ginnie Mae provides guarantees on mortgage-backed securities (MBS) backed by federally insured or guaranteed loans, mainly loans issued by the Federal Housing Administration, Department of Veterans Affairs, Rural Housing Service, and Office of Public and Indian Housing. Ginnie Mae securities are the only MBS that are guaranteed by the United States government.
http://en.wikipedia.org/wiki/GNMA
http://www.ginniemae.gov/about/about.asp?Section=About

Vanguard Treasury Money Market Fund #0050 (VMPXX)
https://personal.vanguard.com/us/funds/snapshot?FundId=0050&...

Holds only U.S. Government & Agency paper. "The fund invests solely in high-quality, short-term money market securities whose interest and principal payments are backed by the full faith and credit of the U.S. government. At least 80% of the fund’s assets will always be invested in U.S. Treasury securities; the remainder of the assets may be invested in securities issued by U.S. government agencies. The fund will maintain a dollar-weighted average maturity of 90 days or less."
https://personal.vanguard.com/us/FundsStrategyAndPolicy?Fund...

The only way you can get closer to your government is to buy Treasury Bills, Notes, Bonds, and Treasury Inflation-Protected Securities (TIPS) directly through Treasury Direct.
http://www.treasurydirect.gov/indiv/myaccount/myaccount_trea...

The advantage of Vanguard's Treasury Money Market Fund is that you can get a check book that allows you write checks (minimum check $250) on the account.
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Author: UMassHoops One star, 50 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 1062 of 1109
Subject: Re: Brinker Still Advising GNMA funds Date: 7/13/2008 10:26 AM
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Did Bob mention anything on his show about completely missing the 20% drop in the market?

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Author: desertdaveataol Big funky green star, 20000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 1063 of 1109
Subject: Re: Brinker Still Advising GNMA funds Date: 7/13/2008 11:11 AM
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Bob Brinker opens virtually every show that he hosts with a recoup of the past week's market. So to say that he "missed" the current downturn is a bit of a stretch. He's reported every step down.

Just because he hasn't reacted to the market's recent moves in the same way you have, or wish him to, doesn't mean he's not on top of the situation. Just because he hasn't offered some advice you seem to expect doesn't mean he's under any obligation to offer it just to make you happy.

I can not, and do not claim to, speak for Bob Brinker. Also, I'm not a subscriber to his newsletter so I'm not privy to any information or reasoning given there. That being said, it is my impression that he advises "investment" as opposed to "trading" for his listeners and subscribers.

Recently another TMF board member, who's investing acumen I very much admire, who had (chronologically) followed me into investing in Vanguard's GNMA fund got out of it because she perceived net asset value fluctuation to the downside.

I stayed in.

More recently she's jumped back into Vanguard's GNMA fund because recent events have convinced her that the fluctuation was just that.

Assuming she earned ~5% on her money during the time she was out of Vanguard's GNMA fund, there's still the little matter of broker fees. While she was out and about I was earning ~5% and keeping those brokerage fees (and taxing consequences) in my pocket.

Of course Brinker's advice isn't limited to Vanguard's GNMA fund or Vanguard, but Brinker's advice is geared toward asset safety and long term investment. Since you choose not to follow his advice, I'm wondering just where you would have put the money you seemingly would have taken out of the market 20% ago? Assuming, of course, that you foresaw the current slump in time to get out at the exact top.

Where did you in invest?

How much is the money earning now?

Are your investments up or down for the period?

Inquiring minds want to know.

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Author: UMassHoops One star, 50 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 1064 of 1109
Subject: Re: Brinker Still Advising GNMA funds Date: 7/13/2008 8:21 PM
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When I say Bob Brinker "missed" the downturn I wasn't referring to whether he is reporting week by week the stock market results. I am referring to his infamous "timing model" missing the downturn which is Bob Brinker's claim to fame.

I was once a subscriber, so I'll sum it up for you:

Bob Brinker claims to have a market timing model that will tell you when to remain fully invested in the stock market, and when you should take your money out of the stock market. It's that simple. He claims you can beat the market by following his advice.

In the case of the recent 20-22% decline in the market Bob Brinker's model has continued to advise people to remain fully invested.

I don't claim to have any such model or any idea which direction the market will go (unless you get a couple drinks in me). But Bob Brinker claims to know and charges folks a lot of money for that advice.

I am curious why his model seems to have failed so miserably in this latest downturn. If Bob had the cohones to publically discuss it on his marketing program I would have more respect for him. Hence my curiosity as to whether he had anything to say about it.

If you must know, just for the heck of it:

Where did you in invest? I haven't changed my investment mix substantially since the downturn began other than purchasing small positions in UNAM, WFC & JNJ. I also have sold out to take tax losses on UNH & BAC. I am substantially overweight BRK long term and have a number of shares in APC & PTR (which I should have sold when Warren Buffett did).

How much is the money earning now? No idea, I can't track the growth or loss of intrinsic value in a company daily. But I suspect on the whole holding it's own in intrinsic value if not stock price. My dividend yield is very low because BRK which is my largest holding doesn't pay a dividend.

Are your investments up or down for the period? Down substantially. Don't have the time or inclination to calculate exactly how much since I have things spread out between 401K's, 403B's, IRA, several taxable accounts and it gets complex. But by and large BRK is down substantially and that has the most weight in my portfolio. Not quite down as much as the market but close.

Of course my performance is completely irrelevant since I never tried to sell you a newsletter claiming I could beat the markets with a super secret model. Bob Brinker did and does every day.

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Author: desertdaveataol Big funky green star, 20000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 1065 of 1109
Subject: Re: Brinker Still Advising GNMA funds Date: 7/14/2008 1:22 AM
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Bob Brinker claims to have a market timing model that will tell you when to remain fully invested in the stock market, and when you should take your money out of the stock market. It's that simple. He claims you can beat the market by following his advice.

And how do you know he should have told subscribers to get out?

How do you know the investments he's currently recommending to his newsletter subscribers aren't doing well enough for him to think they should stay in them?

Then there's the minor little problem of what to do with the cash once the stocks are sold. What did Bob Brinker suggest subscribers do with the money they pulled out of the market last time?

Your argument is based on the premise that Brinker should have recommended a change in investments for his subscribers. I'm not sure Mr. Brinker would agree with you on that.

Also, since we are both (now) non-subscribers, it may be that Bob Brinker has indeed recommended a change in investment strategy to his subscribers since he typically doesn't announce those changes to the general public (radio listeners) until a week or so after he signals his subscribers.

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Author: UMassHoops One star, 50 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 1066 of 1109
Subject: Re: Brinker Still Advising GNMA funds Date: 7/15/2008 9:55 AM
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You can answer most of your questions with a simple google search so I will let you draw your own conclusions. We will probably just have to disagree on the effectiveness of Bob Brinker's market timing claims.

Good luck in your investing.

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Author: jakalant Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 1067 of 1109
Subject: Re: Brinker Still Advising GNMA funds Date: 7/16/2008 8:57 PM
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Bob Brinker opens virtually every show that he hosts with a recoup of the past week's market. So to say that he "missed" the current downturn is a bit of a stretch. He's reported every step down.

Bravo, that's like telling me yesterday's weather. Why would anyone pay for that?

Jack

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Author: desertdaveataol Big funky green star, 20000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 1068 of 1109
Subject: Re: Brinker Still Advising GNMA funds Date: 7/17/2008 12:31 AM
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Bob Brinker opens virtually every show that he hosts with a recoup of the past week's market. So to say that he "missed" the current downturn is a bit of a stretch. He's reported every step down.

Bravo, that's like telling me yesterday's weather. Why would anyone pay for that?


Jack, the OP was saying that Brinker had "missed" the 20% downward move of the markets. Obviously if Bob was talking about the stock movements he (Brinker) hadn't "missed" them.

Also, I suspect you and Bob Brinker have vastly different investing styles. Brinker's advice is geared toward helping people make long term investments, not trading in and out of the markets every day or week. I believe his Marketimer newsletter has called for people to get in or out of the markets only two or three times in the last nineteen years.

His radio show is free. I don't know how much he charges for his newsletter but, from listening to the show, I suspect he's not giving subscribers advice on jumping in and out of the market on a daily basis. That would be trading and Brinker is a long term buy and hold investor.

You may wonder why I, a non subscriber, would be defending him here. Although I invested in Vanguard GNMAs as a result of hearing Bob Brinker's description of them on the radio, I'm primarily invested in dividend paying US utilities. OK, maybe it's closer to half and half.

I limit my long term buy and hold investments in utilities to a maximum of 1000 shares to spread out my risk. (although two utilities that I hold in DRIP accounts PNY, WTR have gone on to build my investments in them up to over 3000 and over 2000 shares after I stopped investing new money in them.

Brinker doesn't talk about DRIPs on his show, probably because it takes a while to get out of them, if you choose to do so.

Here are some of my favorite DRIPs:

PNY (Been paying a dividend for over 25 years.)
Gives a 5% discount on reinvested dividends in its DRIP plan.)

WTR (A fast growing water utility.)
Gives a 5% discount on reinvested dividends in its DRIP plan.)

(Note that both of these companies require that you be enrolled directly in their DRIP plans to earn the 5% discounts. Pseudo DRIPs through brokerages do NOT count and do not earn the 5% discount on reinvested dividends.)

SO (Been paying a dividend for over 58 years.)
(Southern Company does not use a transfer agent. You enroll directly with the company.)

WRE (Been paying a dividend for over 38 years.)
A REIT centered in Washington DC, it'll have renters as long as we have a government.

You might also want to pick up a current copy of Mergent's Dividend Achievers. It will give you a list of companies that have been paying rising dividends for at least 10 years.

http://www.amazon.com/s/ref=nb_ss_/105-8661664-6730001?url=s...

Having picked a stock you want to invest in you could then go to the company's web site via the link in the lower right of this page:

http://finance.google.com/finance
(enter the company's name or ticker symbol at the top)

Then go to the company's web site and look for a link like "Customer Relations" or some such to look for a DRIP.

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Author: UMassHoops One star, 50 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 1069 of 1109
Subject: Re: Brinker Still Advising GNMA funds Date: 7/17/2008 9:58 AM
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Dave, I tried to end this discussion and wish you good luck but don't misrepresent what I was writing about.

"Jack, the OP was saying that Brinker had "missed" the 20% downward move of the markets. Obviously if Bob was talking about the stock movements he (Brinker) hadn't "missed" them."

I was writing about Brinker missing the call on the 20% downward movement in the market in his MARKETTIMER newsletter. The thing people pay him for. By "missed" I mean he did not issue a sell signal for his subscribers and instead has advised remaining fully invested in his model portfolios.

As the other poster indicates, reporting on his show the weekly market moves is essentially the same as reading about the weather in the newspaper.

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Author: desertdaveataol Big funky green star, 20000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 1070 of 1109
Subject: Re: Brinker Still Advising GNMA funds Date: 7/17/2008 11:20 AM
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By "missed" I mean he did not issue a sell signal for his subscribers and instead has advised remaining fully invested in his model portfolios.

In your opinion he 'should' have issued a sell signal. Evidently Brinker does not agree with you.

I do not know his reasoning, but suspect the types of stocks he recommends and his long term view has something to do with Brinker staying in the market.

There is also the question of where to put the money after selling. The First National Bank of Sealey offers 0% interest. FDIC insured bank savings rates are nothing to write home about and FDIC backed CD's aren't much better.

Bankrate.com shows 6 month & 1 yr CD's yielding ~3%. To get ~4% you'd have to commit to a 5 year CD when I checked.
http://www.bankrate.com/brm/rate/deposits_home.asp

My Bob Brinker recommended Vanguard GNMA fund** is yielding ~5.20% with a .11 expense ratio as I write this.

Some here at TMF are publicly advocating a go to cash strategy. Others remain fully (as in my case) or partially invested. Is everyone at TMF who's still holding stocks "wrong"? Time will tell.

Dave, I tried to end this discussion and wish you good luck but don't misrepresent what I was writing about.

Sorry, didn't realize I was misrepresenting what you were writing about, but I agree, we should end this.

Dave

**Why not put your bucks in Vanguard's GNMA fund? It's got Fed backing and you can have a check book (min check $250) so as to have instant access to your money if you need it. (Currently yielding 5.10%)
https://personal.vanguard.com/us/funds/snapshot?FundId=0036&...

Or, if you have enough money (Currently yielding 5.20%)
https://personal.vanguard.com/us/funds/snapshot?FundId=0536&...

The Government National Mortgage Association (GNMA, also known as Ginnie Mae) is a U.S. government-owned corporation within the Department of Housing and Urban Development (HUD).

Ginnie Mae provides guarantees on mortgage-backed securities (MBS) backed by federally insured or guaranteed loans, mainly loans issued by the Federal Housing Administration, Department of Veterans Affairs, Rural Housing Service, and Office of Public and Indian Housing. Ginnie Mae securities are the only MBS that are guaranteed by the United States government.
http://en.wikipedia.org/wiki/GNMA
http://www.ginniemae.gov/about/about.asp?Section=About

Vanguard Treasury Money Market Fund #0050 (VMPXX)
https://personal.vanguard.com/us/funds/snapshot?FundId=0050&...

Holds only U.S. Government & Agency paper. "The fund invests solely in high-quality, short-term money market securities whose interest and principal payments are backed by the full faith and credit of the U.S. government. At least 80% of the fund’s assets will always be invested in U.S. Treasury securities; the remainder of the assets may be invested in securities issued by U.S. government agencies. The fund will maintain a dollar-weighted average maturity of 90 days or less."
https://personal.vanguard.com/us/FundsStrategyAndPolicy?Fund...

The only way you can get closer to your government is to buy Treasury Bills, Notes, Bonds, and Treasury Inflation-Protected Securities (TIPS) directly through Treasury Direct.
http://www.treasurydirect.gov/indiv/myaccount/myaccount_trea...

The advantage of Vanguard's Treasury Money Market Fund is that you can get a check book that allows you write checks (minimum check $250) on the account.

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