Thursday, September 13, 2012

QE3, PM, and PM's

QE3 announced and market gains 207 points to close at 13,540. Fed says they will  be buying $40 billion in mortgage-backed securities each month and keep rates at artificial and "exceptional" low rates until at least 2015. 

Good news for investors that own financial assets and precious metals. Bad news for the poor, middle class, and fixed income savers. 

Watch out for inflation in the coming months and years.

Silver was up over 4% to close at $34.67.  Gold up 2% to close at $1772.

In other news, PM raised dividend 10%!  Corresponds with 4% gain to close at $90.13.

Looking to the future and what I expect to be a heavy inflationary period, a cant lose portfolio are cigarettes and precious metals.  PM and PM's!


  1. I'm a little disappointed with a QE3. I was hoping for a stock market correction as a lot of companies seem to be trading at multi-year highs and higher p/e ratios. I'm also a capitalist and believe in a "free" market. I don't like to continue to bail out the banks.

    It should help my investment in PM's , mainly I just own physical silver. The only tobacco company I own is MO but I'd love to grab some PM at a decent price as well.

    I agree with your assessment that PM and PM's should do well though.

  2. I'm not a fan of QE3, as I'd prefer the training wheels off at this point.

    However, I'll take advantage of whatever I can and adjust to what we're given. QE is no different.

    PM has been killin it. I thought about adding to it when it dipped into the high $80's but it's already almost 10% of my portfolio.

    On a related note, what's your thoughts on LO? I'm not a fan of constant FDA attention, but their transition into e-cigs is interesting.

    Best wishes!

  3. Austin Broker,

    Thanks for stopping by!

    I also hold some physical silver along with MO and PM. I would love to add to both and am waiting for pullbacks. I am looking add to MO at $29 (6% yield) and PM at $85 (4% yield).

    As for precious metals, the one caveat I have is that they do not pay me to own them and I like cash flow. I would, however, like to add more so that they make up 5% of my portfolio. Just in case.

  4. Dividend Mantra,

    Thanks for stopping by also!

    I am 100% with you on PM and don't think you can go wrong on buying PM on dips at 4% plus yield buy points.

    I was watching LO when it was beaten down to the $70's back in 2011 on the FDA rumors they would ban menthol cigs. I almost pulled the trigger but didn't. FDA announced they would not bad menthol cigs and it shot up like a rocket after.

    Could be interesting in the low $100's (w/ 6% yield), but if it ever got there, MO and PM would most likely also look very attractive at that point of time as well.