Sunday thoughts

  1. Suppose you decide you want to buy something that ‘locks in the drop in the market so far’ but isn’t very likely to drop much lower in a rout. Classically, this would be large cap value that happened to have mirrored the drop in the index, I suppose. Maybe Berkshire. Perhaps something that prospers in recessions - or plagues. Perhaps something that does unusually well in Q4 or Q1 specifically each year. Perhaps something foreign that does wonderfully from a strong dollar. (I saw a newsletter touting that idea that ‘european healthcare never does badly during eras with a strong dollar’. I’m skeptical, naturally.) - Does anyone have any ideas?

  2. I find it useful to combine anecdotes with data. Does anyone have any thoughts on ‘how their own industry is likely to do in Q4/Q1’ or ‘inflation as you are living it’?


There are a few things come to mind

This is over complicating things
…then as my Irish mother would say,
“This is money burning a hole in ones pocket”,
“a fool and his money are easily parted”.

My experience is Econ, applied to this market:

The dollar can stop appreciating at any time.

The IRA in 2023 will be bringing inflation down considerably as it was designed to do. That is also the reason the USD can stop appreciating.

Further it is a mistake to think the US equities market would turn upward if the FED stop raising rates. This is now all about inflation and the IRA with a bigger purpose of normalizing prices for goods and services, equities and bonds, and commodities for the middle class to thrive. This is about not using the national debt to buoy or feed the equities markets while the wealth of the nation suffers.

I have my own ideas for later in the 2023 that I will keep to myself.

This insight makes the thread worthwhile, all by itself. Thank you.

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Far be it for me to give you investing advice - I’m a very conservative investor and I’m 95% in cash right now. But I’ll tell you that I have two former employers on my list to re-invest in when I see the S&P really puking. I’m thinking another 20% from here would be good - but could still go down from there.

Neither company has a track record of growing in Q4/Q1, but having worked for both companies, I can say that they are both first-class organizations that are very diversified and shareholder oriented.

Here’s a somewhat dated (2016) analysis on both companies by the Fool:

I’ve also been interested in BRK and I’ll probably pick up some of that as well. The balance of our investments will probably just be in an S&P Index fund.

Hope that helps!


Hello 38,

I’m a very conservative investor and I’m 95% in cash

I’m 99% cash, so you seem like a bold, risk-taking kind of investor in my view :wink:

Thank you for the ideas!

PG & JNJ are both still a tad expensive for me, even at 20% off.

PG: historic PER 21.4, forward 19.56

JNJ: historic PER 23.3, forward 15.14

The problem is, I also would have to buy some ludicrously expensive dollars with my worthless euros if I wanted to buy them; I would have to gamble on a 20% drop that affects them too, I would have to gamble on the USD holding its current value in currency terms. Those don’t feel like great bets.

Whereas there are so many Euro, Japanese ETFs full of diverse companies, no chance of going to zero, and on PERs from 9-12 on average, without the risk of being beaten up by currency in coming years whenever it mean reverts. So that’s my own personal benchmark for ‘hopefully not going down much more, hopefully good upside’.

Since you mentioned JNJ. Did you know that european healthcare majors are already on an average PER around 15? (and about 50% cheaper by book value vs JNJ too) e.g. HLTH etf.

Thanks for offering up something to think about!


Hi @Luxmain,

Thanks for this information. I forgot that you are in the EU!

I don’t think I’ve ever seen a European factsheet for a listing. I looked for the Expense Ratio but could not find it. I’m assuming that it is the TER @ 0.18% - is that correct?


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If you know the German market central Europe is moving to supply side econ. The companies that will naturally have stronger monopolies are by far your best bet in EUR.

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I’m assuming that it is the TER @ 0.18% - is that correct?

Yes, TER is the Total Expense Ratio.

However I believe it may not include trading costs incurred by the fund, because I’ve seen funds with quite high turnover and low TERs.

BTW the Eur will be appreciating next year. Interest rates will rise against inflation.

Oil companies will be generating lots of free cash flow. For example, DVN will be paying out a decent regular quarterly dividend plus half of its free cash flow.