Tax-Managing Your Investment Portfolio: There’s Still Time to Cut Your 2008 Taxes

by Alexander Green, Chairman, Investment U Investment Director, The Oxford Club Monday, December 1, 2008: Issue #894

Investment legend John Templeton insisted that everyone’s long-term investment goal should be the same: maximum total return after taxes.

In my experience, investors spend plenty of time thinking about risk and return, but not enough about taxes. That’s unfortunate. Especially since - unlike the stock market, interest rates or inflation - taxes are controllable.

Yet too many investors are surrendering far more to the taxman than they should. A Vanguard study, for example, found that the typical investor is giving up 2% a year to the IRS. That’s nearly 20% of the long-term return of the S&P 500. How can you stop this and still remain a law-abiding, civic-minded individual?

It starts with tax-managing your investment portfolio…

Tax-Managing Your Investment Portfolio -

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The outlook is bleak for retailers, says Adam Lass. As job losses mount, households are cutting back on all non-essential spending. And massive government bailouts won’t reach the high street in the near future. Adam says investors should continue to short the retail sector.

This from Taipan Daily:

We came, we saw, we ate too damn much.

(One of these days, I’ll ask my oldest daughter to translate that into Latin for me. She never did master the more common romance languages. But she’s the family whiz at Cicero and Caesar.)

The second phase of the “Great Annual Pig Out” (the first being the candy-fueled grotesquery that has swallowed All Hallows’ Eve and the third, the week-long debauchery that is Chanukah-Christmas-New Years) is now officially over and done with.

Under our belts, as it were.

We drove, we flew, heck, those who couldn’t avoid it might

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Some not so breaking news for our readers We signaled a few weeks ago [Nov 12: CNBC Europe - USA May Lose its AAA Rating] Minerd doubts that private savings in the U.S. and foreign purchases of Treasury debt will be sufficient to meet those government cash requirements. That leaves the Fed to take up the slack; that is, monetization of the debt. (in English this means when there is no buyer for US Treasuries we will create the buyer in house: the Federal Reserve. So the left hand will be buying from the right hand i.e. desperation... banana republic style) And lo an behold, the great helicopter drop of all time is being hinted at - the actual buying of US Treasuries by the Federal Reserve (since at some point no one ...

There's a great story at the Washington Post today about the interplay between retail spending and retail hiring. Specifically, the Post notes that because the holiday shopping season looks so grim, retailers aren't doing much of the seasonal hiring they typically do this time of year. More below ..."This is the time of year when retail jobs are supposed to be as plentiful as holiday cheer, when stores gear up for the Christmas rush by filling their sales floors with college students, moonlighters and anyone else looking to shore up their income."But no one is feeling very jolly this year."Faced with plummeting sales and spooked shoppers, retailers have cut back on holiday hiring at a time when their pool of applicants is swelling with those who have been laid off from other industries. About 272,000 retail jobs were open at the end of

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ZAGG, Inc. (ZAGG.OB), a leading provider of protective film coverings for personal electronics under the brand name invisibleSHIELD, recently announced its financial results for the third quarter of 2008 ending September 30, 2008. The company reported a significant year-over-year increase in revenues and positive net income for the third quarter and year-to-date. Net sales for the third quarter of 2008 climbed to approximately $6.9 million, an increase of 376 percent compared to net sales of $1.4 million for the third quarter of 2007.

The company’s quarterly gross profit totaled $4.4 million, or 64.7 percent of sales, compared to $1.1 million, or 79.2 percent of sales, during the third quarter of 2007. Gross profit for the nine months ended September 30, 2008 reached $8.5 million, or 68.5 percent of sales, compared to $2.3 million, or 77.3 percent of sales one year earlier. ZAGG reported net income of $889,743 or $0.05 per share

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This week is shaping up to be another active one on the bailout-and-financing front. First and foremost, Congress returns to work this week to consider a once-unthinkable proposal: Put up billions in taxpayer-backed loans so that Detroit’s “Big Three” can be saved. Expect a fight, however, as the bailout debate finally moves past banks to focus on General Motors Corp. (GM), Ford Motor Co. (F), and Chrysler Corp.

The situation is dire. GM is burning through cash at a pace that could mean bankruptcy, and all three players are struggling with high costs, weak vehicle sales, frozen credit lines and dwindling cash reserves calling into question whether they can survive much longer without government help. The answer, of course, is that they probably can’t.

But it’s here that the debate turns political, the Detroit Free Press reports. Congressional Democrats are pushing for some form

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Paulson reworks financial bailout: New targets for investment… even you can apply! Markets plummet… Bill Bonner on when stocks will be cheap enough to buy. OECD predicts global recession… Germany admits contraction has already begun. Wall Street CEOs forecast “rapid,” “deep” U.S. recession. Joel Bowman on a peculiar hissing sound emitting from the Middle East.

For an erudite debate over the Paulson doctrine, we turn to our friends at The Onion this morning:

The Money Hole.

It’s not any more complicated than that, is it?

Indeed, Paulson and company announced a TARP switcheroo yesterday. Now the Treasury’s Troubled Asset Recovery Program (TARP) is suffering a serious case of the STD “mission creep.”

Instead of purchasing troubled assets from banks, the Treasury,

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Even the strongest retail brands are suffering heavy losses as consumers flock to low-cost stores. Andrew Snyder says this spells doom for Under Armour (NYSE:UA). The company has a strong marketing strategy, but its sales estimates are too optimistic for a retailer of expensive niche clothing. Andrew says the stock is overvalued right now, creating a good chance for a profitable short play.

This from Today’s Financial News:

It is tough for many investors to admit, but marketers rule Wall Street. On most days, it is not true fundamentals that rule the Dow. It is the change in the way we perceive a company’s valuation that makes a stock go up or do.

If marketers do their job, share price rises. If they fail, shareholders feel the pain.

Investors rarely weigh a company’s marketing talent in their decision-making process. It is a flaw that could cost them dearly. In many cases, a firm’s

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I suspect now is the time to bring out the....RALLY MONKEY!!!Was watching Bloomie TV last night as commentators went ga-ga over the 'terrible and way unexpected' warning from Intel (NASAQ:INTC).The stock is down around 6% this morning.They didn't say anything we didn't already hear from Best Buy (NYSE:BBY) yesterday. Demand has fallen off the cliff and inventory levels have grown. Notice how BBY bounced?It was only matter of time when the Wall St. induced crisis hit the Main Street. It's here and the stocks have already discounted it.Paulson put out the open flames at fin. institutions and is now moving on to support the consumer. While the markets yesterday took this as a negative signal, I do believe this is really the prudent step. You can't support the whole system from one end alone.Oh ...

Electronics retailer Best Buy (NYSE:BBY) slashed its full-year outlook today, saying it was “the most difficult climate we’ve ever seen.” But Paul Moore says Best Buy isn’t likely to head the same way as mismanaged Circuit City (NYSE:CC). In fact, BBY should even get a lift from the bankruptcy of its main rival just before the holiday season.

This from Smart Profits Report:

Here in the U.S., the mess continues unabated. The government had to reshape its bailout for AIG, including forking over an extra $40 billion. But despite the floundering company’s fourth consecutive negative quarterly report, the markets reacted positively to the story.

That didn’t help avert the crisis other areas, as Detroit’s automakers repeated their increasingly desperate pleas for some financial

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