The intention of this page is to share investing ideas with friends and family. Since everyone has some money in investments these days, I wanted to talk more about what people are thinking and doing with their money.

I wanted to share my general thoughts, personal guidelines, expectations, and my actual stock picks. Sort of an electronic investing club thing. I am hoping others will post their own feedback in the comments.

general guidelines

All of my investments (with a few money-losing exceptions) are in mutual funds. I decide what category of investment i want to purchase, and then I look for a mutual fund with a history of good returns and low expenses. I pick index funds when i can.

I have recognized my limited ability to pick individual stock winners so I only purchase individual stocks for fun. Fun is not investing; This means that i am not counting on them to make money.

2004

In September 2004, I thought:

• foreign stocks would outperform US stocks and I expected the US dollar to shrivel.
• gas and oil would do well.
• I expected interest rates to rise and bonds to do well.

I tried to pick two good bond funds for safety. I also put some money in a total US market index fund as a safety-play similar to bonds.

In only 3 months, my picks did terrific. I made money on every bet except for the total market play.

2005

For 2005, I just let things ride.

In 2005, oil and gas did fantastic. Interest rates did rise but bonds did lousy (Apparently I dont understand investing in bonds :) although i should get a little kick at the end of the year with interest dividends. International stocks also did great.

By Q3 (and after holding my bonds for 12 months to get the lower tax rate), I decided to sell much of my bond holdings and put the money into more stock funds.

• I added Latin America to my international holdings on the Pacific Rim holdings.
• I also added a midcap value fund and gas utilities to my US holdings.

My forays into individual stocks have continued to suck: Sun has done lousy and I failed to buy Toyota when it was at $78 (I couldn't get the money free in time so its not totally my fault but with the stock well into the $90's now, I just keep kicking myself).

2006

I feel less certain about things moving forward this year than a year ago. Here is what i see:

Interest rates and spending

• Interest rates in the US are higher than Japan or Europe. (this attracts bond investors, raising the price of bonds and lowering the yield)
• I expect the Fed to maintain or even raise the interest rate to bring the housing market down slowly.
• Americans and our government have huge amounts of debt. I expect this to curtail consumer spending next year. this will be painful for consumers and banks. this is bad for corporations.
• GM and Delphi and other big companies will continue to struggle and there may be some big bankruptcies.

Oil and inflation

• Oil is maxed at $60. I expect oil to stay expensive (It was $20 a year ago) but not to rise much higher.
• I expect prices to rise (inflation) due to the higher cost of oil. This will be counter-acted by price pressure from imports.

Regions

• I think Japan, China, and AsiaPacific will continue to outperform the US. (Almost everything we buy now comes from this region.)
• I think Europe will also do well.
• I think the Dow will linger in the 10,000's