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Thursday, December 14, 2017

FIFO Rule Removed from GOP Tax Plan Says Larry Kudlow

This is really great news for us small investors if it makes it through to the final legislation.

This photo of my TV screen tuned to CNBC this morning highlights the provisions of the GOP tax plan that both the Senate and the House of Representatives are getting close to an agreement on.

The GOP plan wanted to raise money to offset lowering taxes on the wealthy by forcing small investors like me to sell our oldest shares first  when taking profits.    Even if you just bought the SPY exchange traded index fund and reinvested dividends and wanted to take some profits, then the rule would have forced you to into a backdoor higher capital gain tax by forcing you to sell the old shares at much lower prices before you could sell the new shares reinvested near the market top!

Last week, as part of "rebalancing" and "taking profits," I sold all my reinvested SPY dividends in a taxable account just in case this rule passes.  This made a big tax hit so this week I've sold shares in some stocks that are down to offset SOME of these gains.  

If you sold stock using the GOP's proposed FIFO (First In First Out) rule, then it would be insane to reinvest dividends in taxable accounts.  That would have been bad for the markets as many might spend the money rather than reinvest.

Why it matters:

Let's say you bought Intel (INTC) 20 years ago and reinvested dividends.  Under current rules, investors can "take profits" by selling the higher priced reinvested dividend shares before they have to sell the much cheaper original shares.

Although I am not looking forward to other states subsidizing most of the high taxes I pay in California with the new GOP tax plan, I am happy to learn that for now the FIFO rule is out.

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Wednesday, December 13, 2017

FNSR Finisar VCSELs - A Billion Dollar Opportunity With Apple's Investment to Speed it Along

Finisar (FNSR charts) VCSELs represent a ONE Billion Dollar opportunity now backed by Apple's (AAPL) investment to speed it along.

Loading up during this period of weakness, especially while under $20, worked out great for me and my subscribers! 

It is nice when one sends an email from his phone when the market opened saying he's pleased with the buy at $17.55 earlier this month (when I had a buy at $17.50 that I used cash in my ROTH to fund.) 

From Apple: Apple awards Finisar $390 million from its Advanced Manufacturing Fund
  • Award Will Create 500 High-Skill Jobs at Sherman, Texas Facility
  • “VCSELs power some of the most sophisticated technology we’ve ever developed and we’re thrilled to partner with Finisar over the next several years to push the boundaries of VCSEL technology and the applications they enable,” said Jeff Williams, Apple’s chief operating officer. “Technology is only as good as the people behind it, and Finisar is a company with a long history of putting its employees first and supporting the community it’s a part of. We’re extremely proud that our involvement will help transform another American community into a manufacturing powerhouse.”
This is a very similar deal to how Apple gives money to Foxcon to make their iPhones. 

To me, I believe Apple wanted a PR win with President Trump to show it is investing in manufacturing in the US and not just China.

Finisar is building in Texas to keep the technology in the US but in a low tax state not in the Silicon Valley where its headquarters is located.  If CA didn't have such high taxes, we might see this plant built up near Redding CA, just below the Shasta Dam where getting low cost renewable electricity would be easier than in Texas.

Market measured in Billions of Dollars:

Simon Leopold - with Raymond James:
The other thing I wanted to ask about is really from an industry perspective, your view of the addressable opportunity for the 3D sensing. So, not specific to what you think you are necessarily going ship but help us understand how you are sizing the market opportunity in 2018? And presumably, I want to ask about 2019, since given the timing of the ramp of the new facility, I have to imagine you are thinking about 2019 already.
Jerry Rawls - Finisar Chairman and CEO:
3D sensing is essentially gigantic. If all the customers and the consumer space and the automotive space really build systems and deploy them as they are -- they have indicated to us recently, then, no matter how big this building is that we just bought, and fill it full of equipment, it’s unlikely that we can supply all of the demand that we’ll need to supply. So, I mean, it’s measured in billions of dollars and it’s really hard to project today that how many of these applications are people really going to field. But, I’ll just tell you, we are building arrays for a lot of different people in both mobile and in automotive, some of them are quite small arrays and some of them are gigantic arrays, so.
Source:  Dec. 7th Earnings Conference Call Transcript

Recent (earlier this month) emailed BUY ALERT to subscribers:

My best buy was near the very bottom of the worst bear market since the Great Depression:

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Update 12/13/17 at 11:38AM PST:  SEC FORM 8-K
Item 8.01 Other Events. Questions have arisen regarding news reports of Apple Inc.’s (“Apple”) announcement this morning regarding a $390 million award to Finisar Corporation (“Finisar”). Apple has not made a debt or equity investment in Finisar. The amount referred to by Apple represents anticipated future business between the companies over a period of time.

Thursday, November 30, 2017

NYSE Resistance and Support Levels

$NYA is the NYSE (New York Stock Exchange) Composite Index.
 Click images to see full size
Blue "Megaphone" pattern

"Andrew's Pitchfork" pattern
Log chart
Kirk Lindstrom's Investment Letter
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Thursday, November 09, 2017

iPhone 10 X Material Cost vs Samsung Galaxy S8

Teardown engineers at IHS Markit (Nasdaq: INFO) report the model A1865 version of the new Apple (AAPL) iPhone X (iPhone Ten) smartphone with 64 gigabytes (GB) of NAND memory carries a bill of materials (BOM) of $370.25.  With its $999 price tag, the materials make up 37% of the phone's cost with the remainder for items such as manufacturing, marketing and profits.

Samsung's Galaxy S8 with the same 64GB of NAND memory carries a BOM of $302 and full retail price is $720.  At $720, the $302 BOM is 42% of the phone's cost.  I bought my S8 a few months ago at Costco (COST) for $600 and got a $50 gift card this month which lowered the final cost to $550.

Click images to see full size

Apple price graph showing open gaps
If Samsung hasn't lowered their BOM for the S8, then at my $550 final cost is 55% of the total compared with 37% for Apple. 

With a 5% to 18% higher profit margin due to its lower BOM as a percentage of retail price, Apple is clearly positioning its phone as a "status symbol" to take advantage of its popularity while it can.

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Wednesday, November 01, 2017

New Series I Bond Rates - November 2017 through April 2018

Today the Bureau of the Public Debt announced earnings rates for Series I Savings Bonds and Series EE Savings Bonds, issued from November 1, 2017 through April 30, 2018.

Series I bond, or iBond, fixed rates are determined each May 1 and November 1. Each fixed rate applies to all I-bonds issued in the six months following the rate determination.

The Current I Bond Composite Earnings Rate is 2.58% and the Top Rate for older i Bonds is 6.12%!  (See Rates for Older Series I Bonds)


For more about how I Bond Rates are calculated and the new rates for older iBonds, see:

Disclaimer: I own Series I Bonds in my personal account (some have base rates of 3.0%!  I also currently have them in my Newsletter Explore Portfolio.

Source: Fiscal Service Announces New Savings Bonds Rates, Series I to Earn 2.58%, Series EE to Earn 0.10%

Wednesday, October 25, 2017

Lozano's Car Wash Coupons - 33% Inflation Over 2016

Here are the latest coupons for Lozano's Car in Mountain View CA. 

This coupon, found on the back of my Safeway receipt, is good through 12/31/17. 
 These higher priced coupons are good through January 31, 2018. Note that their blue "Tuesday Only" price is up $6 or 33.4% over last year at this time!

The various coupon prices are $2 higher than the mid 2017 price that expires in a few days.
This $2 jump matches the $2 per hour jump in Mountain View's minimum wage.

Note that inflation has soared for many reasons including the cost of ACA/Obamacare, soaring Mountain View minimum wages and the high cost of living here means businesses have to pay more to keep good workers.


Visit the Minimum Wage by 2018 page
 for more information

This car wash is located at the corner of Palo Alto, Los Altos and Mountain View California.

This coupon from last year at this time with an 10/31/16 expiration date is $17.99.  Thus $6 inflation in 12 months or $6/$19.99*100%=33.4% inflation!

It is hard to believe we could get our cars washed for $12.99 just four years ago.  I guess that explains why I wash my two autos myself more often than in the past! 

High inflation but still low CD rates

Monday, October 23, 2017

US FY 2017 Deficit - Summary of Receipts, Outlays & Deficit by Month Compared to 2016

This table shows a summary of receipts, outlays, and the deficit (and some months surplus) for the U.S. Government by Month. 

Roughly 16.7¢ of every dollar spent in FY 2017 was new debt!

So, does this table say our budget deficit issues are improving or getting worse?

(Click table to See Full Size Image)
(Click table to See Full Size Image)
Trump won the election in November 2016 but didn't have control of the budget until the January 20th Inauguration. Odd, why the huge slash in Y/Y spending during the first 3 months of FY17?

 #BlameTrump #BlameObama

Wednesday, October 11, 2017

Napa County Active Fire Incident Map with Perimeters

10/12/17 Update: I have a better, larger version of this page at:

I've been posting updates on my Facebook page about the fires but this should show you the Napa, Sonoma and Mendocino County fires in real time.

This one is set for Napa County. If it works, I'll add the others.

Click ">>" for legend to make changes
Enter a street address to get a marker visible when zooming out.

Monday, September 18, 2017

Charts at New Market Highs

Today (9/18/17) the S&P500 and Dow Jones Industrial Average closed at new record highs.

Here are some very interesting charts:

This chart of the Dow is best viewed on a large screen in "Full Screen Mode"
Note the break-out of the Dow above the top dashed blue line followed by a correction to test the breakout from above.  This aligned with many of my sentiment indicators where I also sent out buy alerts for several stocks for my Explore Portfolio.  

Emerging Markets have been on fire, especially since loading up while in the circled yellow region!

Biotech (IBB) is up about 50% from its 2016 bottom.  With plenty of room to the upside for the sector, I have great hope for my Explore Portfolio positions in two small biotech companies that I added to during the period of weakness.  I have some very nice gains already, but would love to see more!

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Thursday, September 14, 2017

GSK's Shingrix containing Agenus' QS-21 Stimulon® adjuvant receives Unanimous FDA Advisory Committee recommendation for approval

LEXINGTON, Mass., Sept. 13, 2017 /PRNewswire/ -- Agenus Inc. (NASDAQ: AGEN), an immuno-oncology company with a pipeline of immune checkpoint antibodies and cancer vaccines, announced today that GlaxoSmithKline's (GSK) shingles vaccine candidate, Shingrix, containing Agenus' proprietary immune adjuvant, QS-21 Stimulon®, was unanimously recommended for approval by the U.S. Food and Drug Administration's (FDA) Vaccines and Related Biological Products Advisory Committee.

"The Advisory Committee's recommendation for the approval of Shingrix marks the first for a product that includes Agenus' proprietary immune adjuvant, QS-21 Stimulon, and serves as a significant validation," said Garo Armen, Ph.D., Agenus (AGEN) CEO and Chairman of the Board. "In addition to being studied in diverse development stage vaccines, QS-21 Stimulon is also a critical component of our neoantigen vaccine formulations. We believe QS-21 provides Agenus with a competitive advantage due to its demonstrated ability to bolster immunogenicity in diverse vaccine formulations offering potential benefit to patients."

A Biologics License Applications (BLA) filed with the FDA by GSK for Shingrix for the prevention of herpes zoster (also known as shingles) in people aged 50 years and older is under regulatory review. The FDA will consider the Advisory Committee vote as it reviews the BLA, although it is not required to follow the recommendation.

GSK's shingles vaccine candidate is not currently approved for use anywhere in the world. Regulatory filings in the European Union, Canada, Australia and Japan are underway

QS-21 Stimulon is being evaluated in various GSK development candidates in addition to being studied in Agenus' neoantigen vaccine, AutoSynVax™, now in a Phase 1 clinical trial.

About Agenus 
Agenus is a clinical-stage immuno-oncology company focused on the discovery and development of therapies that engage the body's immune system to fight cancer. The Company's vision is to expand the patient populations benefiting from cancer immunotherapy by pursuing a number of combination approaches that leverage a broad repertoire of antibody therapeutics and proprietary cancer vaccine platforms. The Company is equipped with a suite of antibody discovery platforms and a state-of-the-art GMP manufacturing facility with the capacity to support early phase clinical programs. Agenus is headquartered in Lexington, MA. For more information, please visit; information that may be important to investors will be routinely posted on our website.

Forward-Looking Statements 
This press release contains forward-looking statements that are made pursuant to the safe harbor provisions of the federal securities laws, including statements regarding the FDA's pending review of GSK's BLA for Shingrix, as well as statements regarding Agenus' product candidates and clinical trial plans and activities. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially. These risks and uncertainties include, among others, the factors described under the Risk Factors section of our most recent Quarterly Report on Form 10-Q or Annual Report on Form 10-K filed with the Securities and Exchange Commission. Agenus cautions investors not to place considerable reliance on the forward-looking statements contained in this release. These statements speak only as of the date of this press release, and Agenus undertakes no obligation to update or revise the statements, other than to the extent required by law. All forward-looking statements are expressly qualified in their entirety by this cautionary statement.


Agenus Inc. 
Michael Plater 

View original content:

SOURCE Agenus Inc.

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Wednesday, September 06, 2017

During Market Turbulence Diversification Works!

Yesterday a subscriber who's worked to get a better asset allocation for her age (after subscribing to my newsletter 2.5 yrs ago in early 2015) was worried about the market and current events sent me this short email.
On 9/5/2017 5:16 PM, RH wrote: 
Hi Kirk;  
The market really looks like it tanked today, right?
OMG, I never really know what to do with next step……
I try to answer all emails, even if they don't have a specific question as I see part of my "service" is to reassure subscribers when they are worried.

Here is part of my reply (removing some personal details for this "edited" reply.)
Remember, one reason we took so many profits and diversified from US stocks that were way up to add to international stocks and build cash is the market often goes down.  You have a LOT of cash now (50:50 conservative asset allocation) so if the market goes down by 10 or 20%, then you could put some of it to work buying stocks at sale prices.

  • an H-bomb tested by the nut in N. Korea plus
  • Hurricane Harvey left hundreds of thousands with huge storm damage in Texas
  • Hurricane Irma is heading towards Florida and it could be even bigger
  • Tropical storm Jose is following Irma and could hit either areas just as they start to recover..... 
yet the stock market was only off about 3% at the low!  Stocks like Finisar and GE really suffered but others that investors love, including Emerging markets (VWO) that we recently bought at much lower prices, continue to do well. 
So... remember that your asset allocation is much better now even with the stock market near record highs!  You've done the work to be ready for a big decline.... yet if the market continues to chug higher, you have enough in to do really well too!
On 9/6/2017 10:24 AM, RH wrote: 
You somehow know me well and give me peace of mind.
Thank you ever so much.
Nobody likes to see stocks they own go down but with proper asset allocation and diversification, big declines are great opportunities to increase your overall market return.

Lets say you retire with a $1,000,000 investment portfolio.  To sleep well at night you put half into fixed income and half into stocks according to my "Conservative Core Portfolio."  If the stock market drops 50%, which is has twice since the year 2000, then you would have roughly $750,000 and probably more because your fixed income on the conservative side of the portfolio would continue higher and your stock portfolio (ETFs or individual stocks) would continue to pay dividends.  

I'd use the 50% bear market to significantly add stocks to my Explore Portfolio (as I did during both bear markets.)  I would also do a MINIMUM of one portfolio reallocation from fixed income to stocks at the end of the year if stocks were still down just as last January I moved a great deal of cash out of markets that were way up in the Core Portfolios to fixed income to lock in gains.

If you need references to verify I took profits when the markets were up and bought when they were down to get the returns I post, then I am happy to provide them.  It blows me away that so many sell their newsletter services and don't provide simple return tables and graphs like I do below.  That is a RED FLAG WARNING about what they sell.

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