Replies to post #38494 on A.I.M. Users Bulletin Board (AIMUSERS)

[Firebird400]

Hi Tom, re- "Ultimate Income Portfolio"
Great article... I would drop the covered call idea and the foreign investments and lean on the junk and the reits a few % points more to make up that 1.6% extra he got in yield. Economy okay here so junk should be fine, plus I'm not into foreign investing and taking the currency risks with no extra yields... I suppose there's a thousand ways to construct a portfolio like that, using the etf's was smart... I'd also look at the discounts available over at CEFA(Closed End Fund Association) if I construct something similar... I noticed he used no high yield minis getting 4-5% right now, more leveraged, in his portfolio... That would kick in a fed tax free yield for that portion... Best regards, Ken

[SFSecurity]

Hi Tom, Thanks for the link. Maybe I should stop complaining/worrying about my current positions as I'm getting a bit over 11% return in dividends. There are a couple that I think I should shed as they are small positions and lower rate of return, but not all that much as a $ %age of the total package.

Going back to your very helpful post about a pyramid with a solid base, this is where I think I am deficient. This is tough because I don't love anything in particular to the point of wanting to hold it long term.

It seems that there is almost always something fundamental that concerns me. For example, take Apple.

A long time ago I was building a special desk to do a variety of things on and was using a solid core door for the top. Since I was going to use a sewing machine on occasion on it I was concerned about vibration. I called my dad, a civil engineer, and asked him about using a 1 3/8" inch door. His response was to use the 1 3/4" door because it would be a bit over 4 times as resistant to vibration. The iPhone has used Gorilla Glass with a thickness of 0.020" thick and they break rather easily, as I know from my daughter's experience. Why don't they use 0.025" thick glass, or even wildly more, say 0.040"? This would be about 30 times stronger but then there wouldn't be as many iPhones that need repair or replacing. Do I want to hold a position in a company (or an ETF with a position in Apple) that has shown so little concern for its consumers?

Another example is Nestle. Just think a bit about two things they are known for, resisting any effort to reduce sugar consumption to help with the current obesity problem among US kids, the other being the push in the developing world to substitute formula for breast feeding and creating a generation with reduced immunity. Again, do I want to hold a position in a company that is not very concerned about the health of its consumers.

Then there is Union Carbide (now wholly owned by Dow Chemical) and Bhopal and the lack of cleaning up after itself. Accidents will happen, no question, but most of us clean up after ourselves.

I could go on and on but I'll spare you.

Acccck!!! What should I do, hold my nose, avert my eyes and ignore the the failings of most large businesses when it comes to being good citizens?

I know that it is not possible to live totally isolated from the world around me, no more than a fish can avoid the water it swims in. I just don't like swimming in a sewer.

Warmest Regards,

Allen