Ricklee's Wealth Journal

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RICKLEE
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Paid tithe..caught up for 3 weeks. NT

Postby RICKLEE » Sun May 31, 2009 10:30 am

NT
RICKLEE

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RICKLEE
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Getting more free money for Tuition..

Postby RICKLEE » Mon Jun 01, 2009 5:16 pm

..topped up the RESP $1250, and increased monthly contributions to the maximum.
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RICKLEE
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Worked out tonight..

Postby RICKLEE » Mon Jun 01, 2009 5:19 pm

..did not want to miss another workout.
RICKLEE

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RICKLEE
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Practiced my sales pitch for blackjack teaching..

Postby RICKLEE » Mon Jun 01, 2009 5:21 pm

..to a young woman that was in the gym. I knew her as a casino patron. She was very interested in learning what I have to teach.

I gotta get my offer documents going!
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RICKLEE
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Began reading a sales book from the 1980s..

Postby RICKLEE » Tue Jun 02, 2009 5:47 pm

..packed with specific strategies at a level of detail I've not seen before. What's cool is while the book may be dated in style, it is still relevant and probably comes off "fresh" since today's softer sell style is so commonplace.
RICKLEE

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RICKLEE
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Sold an old item online..

Postby RICKLEE » Tue Jun 02, 2009 5:50 pm

...is my love of eBay being rekindled? :shock:
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RICKLEE
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Saved $100 per year on water - repaired the leaky faucet!..

Postby RICKLEE » Wed Jun 03, 2009 7:15 am

..after about 12 months of shameful ignoring of constant dripping, yesterday I had enough and took the wrench to the laundry tub's faucet.

This was only the 2nd time I ever repaired a leaky faucet, the first time for this particular tub.

There is always apprehension doing something for the first time.

Took only 20 minutes to get the defective parts out, 30 minutes to fetch the replacement parts from Home Depot, 10 minutes to put the new parts back on. Total time = 60 minutes. Total $ cost of parts = $19. Total $ savings on water bill? I say $100 per year!
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RICKLEE
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Researched several companies for possible investment NT

Postby RICKLEE » Thu Jun 04, 2009 5:11 pm

nt
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Made my first investment using Warren Buffett methodologies.

Postby RICKLEE » Fri Jun 05, 2009 5:07 pm

..this company has an enduring competitive advantage by virtue of its location and can charge near-monopolistic prices. It has strong and growing profits. It has no long term debt. It can pay a dividend yield of 10% and more. It has done so over the past 10 years. It does not require significant capital expenditures, and any maintenance can be financed by internally generated funds. It has organized labor, but its margins are so fat that it can absorb the small labor force easily. It's customer base will rely on its services for another 2 decades, at least.

The great relief of buying in this Buffett way:
- I don't care what the stock price does.
- I am being paid a steady dividend at a rate of return that far exceeds what I get putting the money in the bank.
- Dividends would be taxed at a better rate than interest
- It's in my RRSP so there's no tax on the income
Last edited by RICKLEE on Sun Jun 07, 2009 12:16 pm, edited 1 time in total.
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RICKLEE
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Studied and finally understood W's Pension Statement..

Postby RICKLEE » Sat Jun 06, 2009 8:00 am

..the good news is the pension is a part of a 3-legged chair:

1. Pension
2. Canada Pension Plan
3. Savings including RRSPs

Further Action Needed:
Check if the benefits are indexed for inflation.
RICKLEE

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RICKLEE
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Found a Warren Buffet style Stock Arbitrage Opportunity..

Postby RICKLEE » Sat Jun 06, 2009 3:24 pm

..talk about the Law of Attraction!

I was just doing a routine look at good stock picks, and one jumped out at me. A company that was profitable with a good dividend and growing EPS, is going to be acquired. The deal closes in 2009 Q3 ending. The compensation is cash plus a fractional share. Based on Friday's prices, the consideration exceeds the shares given up. The percentage gain on the investment in the target stock is 7.8% which is almost 23% on an annualized basis.

Arbitrage is one of the ways Warren Buffet makes money. I learned about it from Buffettology by Mary Buffett.

Although the book does not detail how to do it, I reasoned here's one way to work it:

ARBITRAGE PLAN
1. Buy the target stock.
2. Sell the acquirer's stock short in proportion to the exchange mechanism of the planned acquisition.
3. At the close of the acquisition, tender the target stock shares to the acquirer.
4. Receive the cash and the acuirer's share consideration.
5. Close out the short position.

The stocks in question have been named in my private blog.

ACTION:
Follow up with an arbitrage expert to see if the Plan is sound.
RICKLEE

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RICKLEE
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Paid Tithe. NT

Postby RICKLEE » Sun Jun 07, 2009 12:16 pm

NT
RICKLEE

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Rereading The Intelligent Investor by Benjamin Graham..

Postby RICKLEE » Sun Jun 07, 2009 12:25 pm

..when I first got this book 10 years ago, it was over my head. At that time, tech stocks were all the rage - it was 1999.

The book was bought from an online bookseller, Fatbrain dot com. Today, that bookseller does not exist under its own brand.

Anyways, the book finally makes more sense to me. I have come round to understanding the simple, but sound, methods of investing that Mr. Graham teaches. The Margin of Safety concept is powerful and will guide all my future investing decisions if I am disciplined enough to follow it.

I have been spending a few hours each day, going over financial statements. Having spent years preparing financials myself in my old life as a Chartered Accountant has certainly helped me now as an investor. But what sound investors like Warren Buffett and Benjamin Graham do, I am humbled by my lack of understanding of what wise investors seek in the financials.

For instance, fixed assets are not valuable at their book values, since they are specific to the enterprise and their carrying values have little to do with their relevance as a profit generating company, nor the companies ability to use them to settle their debts at those same values, at liquidation. As an accountant, why did I spend hours and then years getting amortization methods and carrying values right, since they are so meaningless in the investor scope of things? And present and potential investors were supposed to be some of my important customers - I had no idea I was wasting my time on it!
RICKLEE

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RICKLEE
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Renegotiated my lease on my business office..

Postby RICKLEE » Mon Jun 08, 2009 11:39 am

..I proposed a significant rate reduction.

..they refused, but they offered a moderately lower monthly rent if I would commit a longer term.

..I refused, and then they proposed to take me month to month, at the existing rate.

..This is a better deal in that I get a short term commitment in these uncertain times.
RICKLEE

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RICKLEE
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Worked out today..after a 5 day lapse. NT

Postby RICKLEE » Mon Jun 08, 2009 3:08 pm

NT
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